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Predicting the Trend of Well-Being in Germany: How Much Do Comparisons, Adaptation and Sociability Matter?

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  • Stefano Bartolini
  • Ennio Bilancini
  • Francesco Sarracino

Abstract

Using longitudinal data from the German Socio-Economic Panel, we estimate the variation of subjective well-being experienced by Germans over the last two decades testing the role of some of the major correlates of people's well-being. Our results suggest that the variation of Germans' well-being between 1996 and 2007 is well predicted by changes over time of income, demographics and social capital. The increase in social capital predicts the largest positive change in subjective well-being. Income growth, also predicts a substantial change in subjective well-being, but it is compensated for about three fourths by the joint negative predictions due to income comparison and income adaptation. Finally, we find that aging of the population predicts the largest negative change in subjective well-being. This result appears to hinge on the large loss of satisfaction experienced by individuals in old age.

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Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 414.

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Length: 42 p.
Date of creation: 2011
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Handle: RePEc:diw:diwsop:diw_sp414

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Keywords: Subjective well-being; life satisfaction; social capital; sociability; relational goods; relative income; social comparisons; income adaptation; SOEP;

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Citations

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Cited by:
  1. Francesco Sarracino, 2012. "Money, Sociability and Happiness: Are Developed Countries Doomed to Social Erosion and Unhappiness?," Social Indicators Research, Springer, Springer, vol. 109(2), pages 135-188, November.
  2. Jirí Vecerník & Martina Mysíková, 2014. "(Un)happy transition? Subjective Well-being in European Countries in 1991-2008 and Beyond," WIFO Working Papers, WIFO 467, WIFO.
  3. Stefano Bartolini & Ennio Bilancini, 2010. "If not only GDP, what else? Using relational goods to predict the trends of subjective well-being," International Review of Economics, Springer, Springer, vol. 57(2), pages 199-213, June.
  4. J.ntti, Markus & Kanbur, Ravi & Nyyss.l., Milla & Pirttil., Jukka, 2012. "Poverty and Welfare Measurement on the Basis of Prospect Theory," Working Paper Series, World Institute for Development Economic Research (UNU-WIDER) UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  5. BARTOLINI Stefano & MIKUCKA Malgorzata & SARRACINO Francesco, 2012. "Money, Trust and Happiness in Transition Countries: Evidence from Time Series," CEPS/INSTEAD Working Paper Series 2012-04, CEPS/INSTEAD.
  6. Bilancini, Ennio & D'Alessandro, Simone, 2012. "Long-run welfare under externalities in consumption, leisure, and production: A case for happy degrowth vs. unhappy growth," Ecological Economics, Elsevier, Elsevier, vol. 84(C), pages 194-205.
  7. SARRACINO Francesco, 2011. "Richer in money, poorer in relationship and unhappy? Time series comparisons of social capital and well-being in Luxembourg," CEPS/INSTEAD Working Paper Series 2011-01, CEPS/INSTEAD.
  8. Beja Jr., Edsel, 2014. "Income growth and happiness: Reassessment of the Easterlin Paradox," MPRA Paper 53360, University Library of Munich, Germany.
  9. Felix, FitzRoy & Michael, Nolan & Max, Steinhardt & David, Ulph, 2013. "Testing the Tunnel Effect: Comparison, Age and Happiness in UK and German Panels," SIRE Discussion Papers, Scottish Institute for Research in Economics (SIRE) 2013-29, Scottish Institute for Research in Economics (SIRE).
  10. Bartolini, Stefano & Sarracino, Francesco, 2014. "The dark side of Chinese growth: Explaining decreasing well-being in times of economic boom," MPRA Paper 57765, University Library of Munich, Germany.

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