Reference group consumption and the subjective wellbeing of the poor in Peru
AbstractThis paper studies the relationship between the consumption of the reference group and people's subjective wellbeing in seven poor Peruvian communities. It presents an empirical analysis of the importance of relative consumption for people's feelings of adequacy in five consumption domains (food, housing, education, clothes and health care). Against the assumption that relative consumption only matters for the rich and drawing on recent empirical work in Latin America, the study hypothesises that participants are likely to be influenced by the level of consumption of the area where they live when evaluating their situation. The data come from two surveys implemented in 2004 and 2005 in Peru by the Wellbeing in Developing Countries (WeD), ESRC research group at the University of Bath. The results indicate a negative effect of relative consumption on participants' appraisal of their households' clothes, housing and children's education. However, the study also shows that in domains linked to the need for physical health such as health care and food, appraisals are made based on households' objective situations and that the average consumption in the community does not play a significant role.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Psychology.
Volume (Year): 32 (2011)
Issue (Month): 2 (March)
Contact details of provider:
Web page: http://www.elsevier.com/locate/joep
Subjective wellbeing Relative consumption Poverty Consumption Consumer psychology;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hirschman, Albert O., 1973. "The changing tolerance for income inequality in the course of economic development," World Development, Elsevier, vol. 1(12), pages 29-36, December.
- Guglielmo Maria Caporale & Yannis Georgellis & Nicholas Tsitsianis & Ya Ping Yin, 2007.
"Income and Happiness across Europe: Do Reference Values Matter?,"
CESifo Working Paper Series
2146, CESifo Group Munich.
- Caporale, Guglielmo Maria & Georgellis, Yannis & Tsitsianis, Nicholas & Yin, Ya Ping, 2009. "Income and happiness across Europe: Do reference values matter?," Journal of Economic Psychology, Elsevier, vol. 30(1), pages 42-51, February.
- Belk, Russell W, 1985. " Materialism: Trait Aspects of Living in the Material World," Journal of Consumer Research, University of Chicago Press, vol. 12(3), pages 265-80, December.
- Erzo F. P. Luttmer, 2005.
"Neighbors as Negatives: Relative Earnings and Well-Being,"
The Quarterly Journal of Economics,
MIT Press, vol. 120(3), pages 963-1002, August.
- Erzo F.P. Luttmer, 2004. "Neighbors as Negatives: Relative Earnings and Well-Being," NBER Working Papers 10667, National Bureau of Economic Research, Inc.
- Luttmer, Erzo F. P., 2004. "Neighbors as Negatives: Relative Earnings and Well-Being," Working Paper Series rwp04-029, Harvard University, John F. Kennedy School of Government.
- Geeta Kingdon & John Knight, 2005.
"Community, Comparisons and Subjective Well-being in a Divided Society,"
05095, University of Cape Town, Development Policy Research Unit.
- Kingdon, Geeta Gandhi & Knight, John, 2007. "Community, comparisons and subjective well-being in a divided society," Journal of Economic Behavior & Organization, Elsevier, vol. 64(1), pages 69-90, September.
- Geeta Kingdon & John Knight, 2004. "Community, Comparisons and Subjective Well-being in a Divided Society," Economics Series Working Papers WPS/2004-21, University of Oxford, Department of Economics.
- Geeta Kingdon & John Knight, 2004. "Community, Comparisons and Subjective Well-being in a Divided Society," Development and Comp Systems 0409067, EconWPA.
- Geeta G. Kingdon & John Knight, 2004. "Community, Comparisons and Subjective Well-being in a Divided Society," CSAE Working Paper Series 2004-21, Centre for the Study of African Economies, University of Oxford.
- Neil McCulloch & Bob Baulch, 2000. "Simulating the Impact of Policy upon Chronic and Transitory Poverty in Rural Pakistan," Econometrics 0004003, EconWPA.
- Carol Graham & Andrew Felton, 2006. "Inequality and happiness: Insights from Latin America," Journal of Economic Inequality, Springer, vol. 4(1), pages 107-122, April.
- Veblen, Thorstein, 1899. "The Theory of the Leisure Class," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1899.
- Ravallion, Martin & Lokshin, Michael, 2005.
"Who cares about relative deprivation ?,"
Policy Research Working Paper Series
3782, The World Bank.
- John Knight & Ramani Gunatilaka, 2008. "Aspirations, Adaptation and Subjective Well-Being of Rural-Urban Migrants in China," Economics Series Working Papers 381, University of Oxford, Department of Economics.
- Neil McCulloch & Bob Baulch, 2000. "Simulating the impact of policy upon chronic and transitory poverty in rural Pakistan," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 100-130.
- Di Tella, Rafael & MacCulloch, Robert J. & Oswald, Andrew J., 2001.
"The Macroeconomics of Happiness,"
The Warwick Economics Research Paper Series (TWERPS)
615, University of Warwick, Department of Economics.
- Di Tella, R. & MacCulloch, R.J.: Oswald, A.J., 1997. "The Macroeconomics of Happiness," Papers 19, Centre for Economic Performance & Institute of Economics.
- DiTella, Rafael & MacCulloch, Robert & Oswald, Andrew J., 1999. "The macroeconomics of happiness," ZEI Working Papers B 03-1999, ZEI - Center for European Integration Studies, University of Bonn.
- Ferrer-i-Carbonell, Ada, 2005. "Income and well-being: an empirical analysis of the comparison income effect," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 997-1019, June.
- Alex Michalos, 1985. "Multiple discrepancies theory (MDT)," Social Indicators Research, Springer, vol. 16(4), pages 347-413, May.
- Ada Ferrer-i-Carbonell & Paul Frijters, 2002.
"How important is Methodology for the Estimates of the Determinants of Happiness?,"
Tinbergen Institute Discussion Papers
02-024/3, Tinbergen Institute.
- Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, 07.
- Fafchamps, Marcel & Shilpi, Forhad, 2006.
"Isolation and Subjective Welfare,"
CEPR Discussion Papers
6001, C.E.P.R. Discussion Papers.
- J. Allister McGregor & Andrew McKay & Jackeline Velazco, 2007. "Needs and resources in the investigation of well-being in developing countries: illustrative evidence from Bangladesh and Peru," Journal of Economic Methodology, Taylor & Francis Journals, vol. 14(1), pages 107-131.
- Bearden, William O & Etzel, Michael J, 1982. " Reference Group Influence on Product and Brand Purchase Decisions," Journal of Consumer Research, University of Chicago Press, vol. 9(2), pages 183-94, September.
- Monica Guillen-Royo, 2008. "Consumption and Subjective Wellbeing: Exploring Basic Needs, Social Comparison, Social Integration and Hedonism in Peru," Social Indicators Research, Springer, vol. 89(3), pages 535-555, December.
- Inga Hillesheim & Mario Mechtel, 2012. "How Much Do Others Matter? Explaining Positional Concerns for Different Goods and Personal Characteristics," IAAEU Discussion Papers 201210, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
- Monica Guillen-Royo & Laura Camfield & Jackeline Velazco, 2013. "Universal and Local Reconciled: Exploring Satisfaction with Universal and Local Goals in Thailand and Bangladesh," Social Indicators Research, Springer, vol. 113(2), pages 627-645, September.
- Hillesheim, Inga & Mechtel, Mario, 2013. "How much do others matter? Explaining positional concerns for different goods and personal characteristics," Journal of Economic Psychology, Elsevier, vol. 34(C), pages 61-77.
- Asadullah, Niaz & Chaudhury, Nazmul, 2012.
"Subjective Well-Being and Relative Poverty in Rural Bangladesh,"
IZA Discussion Papers
6569, Institute for the Study of Labor (IZA).
- Asadullah, Mohammad Niaz & Chaudhury, Nazmul, 2012. "Subjective well-being and relative poverty in rural Bangladesh," Journal of Economic Psychology, Elsevier, vol. 33(5), pages 940-950.
- Alem, Yonas, 2014. "Life-Satisfaction in Urban Ethiopia: The Role of Relative Poverty and Unobserved Heterogeneity," Discussion Papers dp-14-04-efd, Resources For the Future.
- Laura Camfield & Awae Masae & J. McGregor & Buapun Promphaking, 2013. "Cultures of Aspiration and Poverty? Aspirational Inequalities in Northeast and Southern Thailand," Social Indicators Research, Springer, vol. 114(3), pages 1049-1072, December.
- Alem, Yonas, 2013. "Relative Standing and Life-Satisfaction: Does Unobserved Heterogeneity Matter?," Working Papers in Economics 579, University of Gothenburg, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.