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When Information Dominates Comparison. A Panel Data Analysis Using Russian Subjective Data

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  • Claudia Senik

Abstract

We propose a micro-econometric investigation into the relation between subjective life satisfaction and income distribution, using a balanced panel survey of the Russian population (RLMS), running from 1994 to 2000, including 4096 individuals. We show that in the context of the Russian very volatile environment, Hirschman's (1973) "tunnel effect" conjecture seems to be validated : variables reflecting income distribution do not influence satisfaction through social comparisons; individuals rather seem to use their informational content in order to form their expectations. The reference group's income exerts a positive influence on individual satisfaction, which contrasts with other studies on the subject. Inequality indices do not affect individual welfare.

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Paper provided by DELTA (Ecole normale supérieure) in its series DELTA Working Papers with number 2002-02.

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Date of creation: 2002
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Handle: RePEc:del:abcdef:2002-02

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Cited by:
  1. Russell Smyth & Ingrid Nielsen & Qingguo Zhai, 2010. "Personal Well-being in Urban China," Social Indicators Research, Springer, vol. 95(2), pages 231-251, January.
  2. Akay, Alpaslan & Martinsson, Peter, 2012. "Positional Concerns through the Life Cycle: Evidence from Subjective Well-Being Data and Survey Experiments," IZA Discussion Papers 6342, Institute for the Study of Labor (IZA).
  3. Clark, Andrew E. & Knabe, Andreas & Rätzel, Steffen, 2009. "Boon or Bane? Others' Unemployment, Well-being and Job Insecurity," IZA Discussion Papers 4210, Institute for the Study of Labor (IZA).
  4. David G. Blanchflower & Andrew J. Oswald, 2004. "Money, Sex, and Happiness: An Empirical Study," NBER Working Papers 10499, National Bureau of Economic Research, Inc.
  5. Frijters, Paul & Liu, Amy Y.C. & Meng, Xin, 2012. "Are optimistic expectations keeping the Chinese happy?," Journal of Economic Behavior & Organization, Elsevier, vol. 81(1), pages 159-171.
  6. Andrew E. Clark, 2012. "Happiness, Habits and High Rank: Comparisons in Economic and Social Life," SOEPpapers on Multidisciplinary Panel Data Research 452, DIW Berlin, The German Socio-Economic Panel (SOEP).
  7. Eduardo Pérez-Asenjo, 2011. "If happiness is relative, against whom do we compare ourselves? Implications for labour supply," Journal of Population Economics, Springer, vol. 24(4), pages 1411-1442, October.
  8. Lelkes, Orsolya, 2003. "A pénz boldogít? A jövedelem és hasznosság kapcsolatának empirikus elemzése
    [Can money buy happiness? An empirical analysis of the relation between income and utility]
    ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(5), pages 383-405.

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