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Beyond the Joneses: inter-country income comparisons and happiness

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Author Info

  • Leonardo Becchetti

    ()
    (Department of Economics, Universitˆ Tor Vergata)

  • Stefano Castriota

    ()
    (Department of Economics, Universitˆ di Perugia)

  • Elena Giachin

    ()
    (Department of Economics, Universitˆ Tor Vergata)

Abstract

Our paper provides some novel evidence on the burgeoning literature on life satisfaction and relative comparisons by showing that in the last 30 years comparisons with the wellbeing of top income countries have generated progressively more negative feelings on a large sample of individuals in the Eurobarometer survey. The paper contributes in two main directions: (i) it shows that countries, and not just neighbors, can be reference groups; (ii) it documents a globalization effect by which distant countries become progressively closer and comparisons among them more intense and relevant. Our findings may be interpreted in support of the well known hypothesis that migratory decisions are affected by the gap in economic wellbeing between origin and destination country since they document that such gap affects individual life satisfaction.

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File URL: http://econometica.it/wp/wp25.pdf
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Bibliographic Info

Paper provided by Econometica in its series Econometica Working Papers with number wp25.

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Length: 16
Date of creation: Dec 2010
Date of revision:
Handle: RePEc:ent:wpaper:wp25

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Keywords: life satisfaction; relative income; standard of living; comparisons;

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References

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  1. Fehr, Ernst & Klein, Alexander & Schmidt, Klaus M., 2005. "Fairness and Contract Design," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 67, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
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  10. Leonardo Becchetti & Sara Savastano, 2009. "The money-happiness relationship in transition countries: evidence from Albania," Econometica Working Papers wp11, Econometica.
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  13. Robert J. MacCulloch & Rafael Di Tella & Andrew J. Oswald, 2001. "Preferences over Inflation and Unemployment: Evidence from Surveys of Happiness," American Economic Review, American Economic Association, vol. 91(1), pages 335-341, March.
  14. Stefan Boes & Rainer Winkelmann, 2010. "The Effect of Income on General Life Satisfaction and Dissatisfaction," Social Indicators Research, Springer, vol. 95(1), pages 111-128, January.
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Citations

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Cited by:
  1. Stefano Herzel & Marco Nicolosi & Catalin Starica, 2011. "The cost of sustainability on optimal portfolio choices," Quaderni del Dipartimento di Economia, Finanza e Statistica 84/2011, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
  2. Mirella Damiani & Fabrizio Pompei & Andrea Ricci, 2011. "Temporary job protection and productivity growth in EU economies," Quaderni del Dipartimento di Economia, Finanza e Statistica 87/2011, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
  3. Davide Castellani & Fabio Pieri, 2011. "Foreign Investments and Productivity Evidence from European Regions," Quaderni del Dipartimento di Economia, Finanza e Statistica 83/2011, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
  4. Barbara Dluhosch & Daniel Horgos, 2013. "Trading Up the Happiness Ladder," Social Indicators Research, Springer, vol. 113(3), pages 973-990, September.
  5. Aronsson, Thomas & Johansson-Stenman, Olof, 2012. "When Samuelson met Veblen abroad: National and global public good provision when social comparisons matter," Working Papers in Economics 538, University of Gothenburg, Department of Economics.
  6. Francesco Venturini, 2011. "Product variety, product quality, and evidence of Schumpeterian endogenous growth: a note," Quaderni del Dipartimento di Economia, Finanza e Statistica 93/2011, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
  7. Ed Diener & Ronald Inglehart & Louis Tay, 2013. "Theory and Validity of Life Satisfaction Scales," Social Indicators Research, Springer, vol. 112(3), pages 497-527, July.
  8. Beja Jr., Edsel, 2014. "Income growth and happiness: Reassessment of the Easterlin Paradox," MPRA Paper 53360, University Library of Munich, Germany.

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