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Well-Being in Germany: What Explains the Regional Variation?

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  • Johannes Vatter
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    Abstract

    This paper examines regional differences in subjective well-being (SWB) in Germany. Inferential statistics indicate a diminishing but still significant gap between East and West Germany, but also differing levels of SWB within both parts. The observed regional pattern of life satisfaction reflects macroeconomic fundamentals, where labor market conditions play a dominant role. Differing levels of GDP and economic growth have contributed rather indirectly to regional well-being such that the years since the German reunification can be considered as a period of joyless growth. In total, approximately half of "satisfaction gap" between East and West Germany can be attributed to differing macroeconomic conditions. Moreover, the effects of unemployment and income differ in size between regions such that one can assume increasing marginal disutility of unemployment. The comparably high levels of life satisfaction in Northern Germany are driven mostly by couples and go along with significantly higher fertility rates. Overall, we conclude that comparisons of SWB within a single country provide valid information.

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    Bibliographic Info

    Paper provided by DIW Berlin, The German Socio-Economic Panel (SOEP) in its series SOEPpapers on Multidisciplinary Panel Data Research with number 435.

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    Length: 35 p.
    Date of creation: 2012
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    Handle: RePEc:diw:diwsop:diw_sp435

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    Keywords: Subjective well-being; regional disparities; unemployment; economic growth; fertility rate;

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    Cited by:
    1. Homann, Malte & Jensen, Uwe, 2013. "Does better education cause higher income?," HWWI Research Papers 145, Hamburg Institute of International Economics (HWWI).
    2. Piper, Alan T., 2013. "Europe’s capital cities and the happiness penalty: an investigation using the European Social Survey," MPRA Paper 47793, University Library of Munich, Germany.

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