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An Examination of the Dynamics of Happiness Using Vector Autoregressions

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  • Martin Binder

    ()

  • Alex Coad

    ()

Abstract

We use a panel vector autoregressions model to examine the coevolution of changes in happiness and changes in income, health, marital status as well as employment status for the British Household Panel Survey (BHPS) data set. This technique allows us to simultaneously analyze the impact of the aforementioned factors on each other. We find that increases in happiness are associated with subsequent increases in income, marriage, employment, and health variables, while increases in the these life-domain variables (except health) tend to be followed by decreases in happiness in subsequent periods, suggesting adaptation dynamics in all domains. These findings are quite robust to different model specifications.

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Bibliographic Info

Paper provided by Philipps University Marburg, Department of Geography in its series Papers on Economics and Evolution with number 2009-04.

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Date of creation: Apr 2009
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Handle: RePEc:esi:evopap:2009-04

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Keywords: Happiness dynamics; vector autoregressions; subjective well-being; BHPS Length 36 pages;

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References

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  15. Alex Coad, 2007. "Exploring the "mechanics" of firm growth : evidence from a short-panel VAR," Documents de travail du Centre d'Economie de la Sorbonne, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne r07037, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
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  19. Graham, Carol & Eggers, Andrew & Sukhtankar, Sandip, 2004. "Does happiness pay?: An exploration based on panel data from Russia," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 55(3), pages 319-342, November.
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  22. Santarelli, Enrico & Vivarelli, Marco, 2006. "Entrepreneurship and the Process of Firms’ Entry, Survival and Growth," IZA Discussion Papers 2475, Institute for the Study of Labor (IZA).
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As found by EconAcademics.org, the blog aggregator for Economics research:
  1. What makes you happy? Expectations
    by Economic Logician in Economic Logic on 2009-06-26 15:38:00
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Cited by:
  1. Martin Binder & Alex Coad, 2010. "Disentangling the Circularity in Sen's Capability Approach – An Analysis of the Co-Evolution of Functioning Achievement and Resources," Papers on Economics and Evolution, Philipps University Marburg, Department of Geography 2010-04, Philipps University Marburg, Department of Geography.

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