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Do social comparisons and negative shocks affect the subjective well‐being of the poor? Evidence from the Peruvian Amazon

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  • Alejandro López‐Feldman
  • Roberto Porro

Abstract

This paper contributes to the literature by testing the effect of a household's relative position on its subjective well‐being. Our results show that both self‐perceived status and relative income have significant effects on the subjective well‐being of households located in the Peruvian Amazon. The paper also considers negative random shocks and shows that non‐agricultural shocks have a negative effect on subjective well‐being. These results imply that public policies aimed toward the improvement of rural households' well‐being in the Peruvian Amazon should look beyond poverty reduction and consider also the positive effects that inequality reduction can have on subjective well‐being.

Suggested Citation

  • Alejandro López‐Feldman & Roberto Porro, 2021. "Do social comparisons and negative shocks affect the subjective well‐being of the poor? Evidence from the Peruvian Amazon," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(3), pages 612-616, April.
    • Handle: RePEc:wly:jintdv:v:33:y:2021:i:3:p:612-616
    DOI: 10.1002/jid.3531
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    References listed on IDEAS

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    1. Fafchamps, Marcel & Shilpi, Forhad, 2008. "Subjective welfare, isolation, and relative consumption," Journal of Development Economics, Elsevier, vol. 86(1), pages 43-60, April.
    2. Ravallion, Martin & Lokshin, Michael, 2010. "Who cares about relative deprivation?," Journal of Economic Behavior & Organization, Elsevier, vol. 73(2), pages 171-185, February.
    3. Knight, John & Gunatilaka, Ramani, 2012. "Income, aspirations and the Hedonic Treadmill in a poor society," Journal of Economic Behavior & Organization, Elsevier, vol. 82(1), pages 67-81.
    4. Porro, Roberto & Lopez-Feldman, Alejandro & Vela-Alvarado, Jorge W., 2015. "Forest use and agriculture in Ucayali, Peru: Livelihood strategies, poverty and wealth in an Amazon frontier," Forest Policy and Economics, Elsevier, vol. 51(C), pages 47-56.
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    1. Ebenezer Lemven Wirba & Ernest Ngeh Tingum & Francis Menjo Baye, 2024. "The cost of keeping‐up with the Joneses: Relative deprivation and food spending in Cameroon," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(1), pages 415-434, January.

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