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Happiness, Habits and High Rank: Comparisons in Economic and Social Life

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  • Clark, Andrew E.

    ()
    (Paris School of Economics)

Abstract

The role of money in producing sustained subjective well-being seems to be seriously compromised by social comparisons and habituation. But does that necessarily mean that we would be better off doing something else instead? This paper suggests that the phenomena of comparison and habituation are actually found in a considerable variety of economic and social activities, rendering conclusions regarding well-being policy less straightforward.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5966.

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Length: 42 pages
Date of creation: Sep 2011
Date of revision:
Publication status: forthcoming in: Stefano Bartolini (ed.), Policies for Happiness. Oxford: Oxford University Press, 2014
Handle: RePEc:iza:izadps:dp5966

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Keywords: divorce; marriage; unemployment; income; habituation; comparison; health; religion; policy;

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References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  1. Claudia Senik, 2002. "When Information Dominates Comparison: A Panel Data Analysis Using Russian Subjective Data," William Davidson Institute Working Papers Series 495, William Davidson Institute at the University of Michigan.
  2. Daniel J. ZIZZO & Andrew J. OSWALD, 2001. "Are People Willing to Pay to Reduce Others'Incomes?," Annales d'Economie et de Statistique, ENSAE, issue 63-64, pages 39-65.
  3. Clark, Andrew E. & Senik, Claudia, 2009. "Who Compares to Whom? The Anatomy of Income Comparisons in Europe," CEPREMAP Working Papers (Docweb), CEPREMAP 0907, CEPREMAP.
  4. Alpizar, Francisco & Carlsson, Fredrik & Johansson-Stenman, Olof, 2001. "How Much Do We Care About Absolute Versus Relative Income and Consumption?," Working Papers in Economics, University of Gothenburg, Department of Economics 63, University of Gothenburg, Department of Economics.
  5. David G. Blanchflower & Andrew J. Oswald & Bert Van Landeghem, 2008. "Imitative Obesity and Relative Utility," NBER Working Papers 14337, National Bureau of Economic Research, Inc.
  6. AndrewE. Clark & Nicolai Kristensen & Niels Westergård-Nielsen, 2009. "Job Satisfaction and Co-worker Wages: Status or Signal?," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 119(536), pages 430-447, 03.
  7. Rafael Di Tella & John Haisken-De New & Robert MacCulloch, 2007. "Happiness Adaptation to Income and to Status in an Individual Panel," NBER Working Papers 13159, National Bureau of Economic Research, Inc.
  8. Betsey Stevenson & Justin Wolfers, 2008. "Economic Growth and Subjective Well-Being: Reassessing the Easterlin Paradox," CESifo Working Paper Series 2394, CESifo Group Munich.
  9. Melenberg, B., 1992. "Micro-econometric models of consumer behaviour and welfare," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3508638, Tilburg University.
  10. Andrew E. Clark, 2003. "Unemployment as a Social Norm: Psychological Evidence from Panel Data," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 21(2), pages 289-322, April.
  11. J. Solnick, Sara & Hemenway, David, 1998. "Is more always better?: A survey on positional concerns," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 37(3), pages 373-383, November.
  12. Olof Johansson-Stenman & Fredrik Carlsson & Dinky Daruvala, 2002. "Measuring Future Grandparents" Preferences for Equality and Relative Standing," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 112(479), pages 362-383, April.
  13. Clark, Andrew E. & Senik, Claudia, 2010. "Will GDP Growth Increase Happiness in Developing Countries?," CEPREMAP Working Papers (Docweb), CEPREMAP 1024, CEPREMAP.
  14. Andrew E. Clark & Nicolai Kristensen & Niels Westergård-Nielsen, 2008. "Economic satisfaction and income rank in small neighbourhoods," PSE Working Papers halshs-00586254, HAL.
  15. Andrew E. Clark & Ed Diener & Yannis Georgellis & Richard E. Lucas, 2007. "Lags and leads in life satisfaction: a test of the baseline hypothesis," LSE Research Online Documents on Economics, London School of Economics and Political Science, LSE Library 19656, London School of Economics and Political Science, LSE Library.
  16. Andrew E. Clark & Orsolya Lelkes, 2009. "Let us pray: religious interactions in life satisfaction," PSE Working Papers halshs-00566120, HAL.
  17. Richard E. Lucas & Andrew Clark & Yannis Georgellis & Ed Diener, 2002. "Re-Examining Adaptation and the Setpoint Model of Happiness: Reactions to Changes in Marital Status," DELTA Working Papers, DELTA (Ecole normale supérieure) 2002-08, DELTA (Ecole normale supérieure).
  18. repec:hal:wpaper:halshs-00566120 is not listed on IDEAS
  19. Clark, Andrew E. & Oswald, Andrew J., 1996. "Satisfaction and comparison income," Journal of Public Economics, Elsevier, Elsevier, vol. 61(3), pages 359-381, September.
  20. Bruno Frey & Alois Stutzer, 2000. "Happiness Prospers in Democracy," Journal of Happiness Studies, Springer, Springer, vol. 1(1), pages 79-102, March.
  21. Clark, A.; & Etilé, F.;, 2010. "Happy House: Spousal weight and individual well-being," Health, Econometrics and Data Group (HEDG) Working Papers, HEDG, c/o Department of Economics, University of York 10/10, HEDG, c/o Department of Economics, University of York.
  22. Conchita D'Ambrosio & Joachim R. Frick, 2007. "Individual Well-Being in a Dynamic Perspective," SOEPpapers on Multidisciplinary Panel Data Research 5, DIW Berlin, The German Socio-Economic Panel (SOEP).
  23. Clark, Andrew E. & Oswald, Andrew J., 1998. "Comparison-concave utility and following behaviour in social and economic settings," Journal of Public Economics, Elsevier, Elsevier, vol. 70(1), pages 133-155, October.
  24. Wu, Stephen, 2001. "Adapting to heart conditions: a test of the hedonic treadmill," Journal of Health Economics, Elsevier, Elsevier, vol. 20(4), pages 495-507, July.
  25. Clark, Andrew E., 1999. "Are wages habit-forming? evidence from micro data," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 39(2), pages 179-200, June.
  26. Clark, Andrew E & Oswald, Andrew J, 1994. "Unhappiness and Unemployment," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 104(424), pages 648-59, May.
  27. Frank, Robert H. & Hutchens, Robert M., 1993. "Wages, seniority, and the demand for rising consumption profiles," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 21(3), pages 251-276, August.
  28. N Powdthavee, 2008. "Ill-Health as a Household Norm: Evidence from Other People's Health Problems," Discussion Papers, Department of Economics, University of York 08/21, Department of Economics, University of York.
  29. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2008. "Relative Income, Happiness, and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," Journal of Economic Literature, American Economic Association, vol. 46(1), pages 95-144, March.
  30. Charness, Gary B & Rabin, Matthew, 2001. "Understanding Social Preferences With Simple Tests," University of California at Santa Barbara, Economics Working Paper Series qt0dc3k4m5, Department of Economics, UC Santa Barbara.
  31. Bernard M. S. van Praag & Barbara E. Baarsma, 2005. "Using Happiness Surveys to Value Intangibles: The Case of Airport Noise," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 115(500), pages 224-246, 01.
  32. Fliessbach, Klaus & Weber, Bernd & Trautner, P. & Dohmen, Thomas J. & Sunde, Uwe & Elger, C. E. & Falk, Armin, 2007. "Social comparison affects reward-related brain activity in the human ventral striatum," Munich Reprints in Economics, University of Munich, Department of Economics 20362, University of Munich, Department of Economics.
  33. KNIGHT, John & SONG, Lina & GUNATILAKA, Ramani, 2009. "Subjective well-being and its determinants in rural China," China Economic Review, Elsevier, Elsevier, vol. 20(4), pages 635-649, December.
  34. repec:pse:psecon:2010-43 is not listed on IDEAS
  35. Bruno S. Frey & Alois Stutzer, . "Maximising Happiness?," IEW - Working Papers 022, Institute for Empirical Research in Economics - University of Zurich.
  36. Oswald, Andrew J. & Powdthavee, Nattavudh, 2006. "Does Happiness Adapt? A Longitudinal Study of Disability with Implications for Economists and Judges," IZA Discussion Papers 2208, Institute for the Study of Labor (IZA).
  37. repec:pse:psecon:2009-01 is not listed on IDEAS
Full references (including those not matched with items on IDEAS)

Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Happiness, Habits and High Rank: Comparisons in Economic and Social Life
    by maximorossi in NEP-LTV blog on 2011-09-26 14:34:45
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Clark, Andrew E. & Etilé, Fabrice, 2011. "Happy house: Spousal weight and individual well-being," Journal of Health Economics, Elsevier, Elsevier, vol. 30(5), pages 1124-1136.
  2. Van Landeghem, Bert & Swinnen, Johan F.M. & Vranken, Liesbet, 2008. "Land and Happiness: Land Distribution and Subjective Well-Being in Moldova," 2008 International Congress, August 26-29, 2008, Ghent, Belgium, European Association of Agricultural Economists 44375, European Association of Agricultural Economists.
  3. Leonardo Becchetti & Alessandra Pelloni, . "What are we learning from the life satisfaction literature?," Working Papers, Department of the Treasury, Ministry of the Economy and of Finance 2, Department of the Treasury, Ministry of the Economy and of Finance.
  4. Leonardo Becchetti & Fabio Pisani, 2012. "Family Money, Relational Life and (Class) Relative Wealth: an Empirical Analysis on Life Satisfaction of Secondary School Students," CEIS Research Paper, Tor Vergata University, CEIS 223, Tor Vergata University, CEIS, revised 21 Feb 2012.
  5. Leonardo Becchetti & Fabio Pisani, 2014. "Family Economic Well-Being, and (Class) Relative Wealth: An Empirical Analysis of Life Satisfaction of Secondary School Students in Three Italian Cities," Journal of Happiness Studies, Springer, Springer, vol. 15(3), pages 503-525, June.
  6. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2006. "Income and happiness: Evidence, explanations and economic implications," PSE Working Papers halshs-00590436, HAL.
  7. Stefano Bartolini & Francesco Sarracino, 2011. "Happy for How Long? How Social Capital and GDP relate to Happiness over Time," Department of Economics University of Siena, Department of Economics, University of Siena 621, Department of Economics, University of Siena.
  8. Uhrig, S.C. Noah, 2005. "Cinema is good for you: the effects of cinema attendance on self reported anxiety or depression and 'happiness'," ISER Working Paper Series 2005-14, Institute for Social and Economic Research.
  9. Jones, A.; & Rice, N.; & Rosa Dias, P., 2010. "Long-term effects of cognitive skills, social adjustment and schooling on health and lifestyle: Evidence from a reform of selective schooling," Health, Econometrics and Data Group (HEDG) Working Papers, HEDG, c/o Department of Economics, University of York 10/11, HEDG, c/o Department of Economics, University of York.
  10. Temesgen Kifle, 2014. "Do Comparison Wages Play a Major Role in Determining Overall Job Satisfaction? Evidence from Australia," Journal of Happiness Studies, Springer, Springer, vol. 15(3), pages 613-638, June.
  11. repec:hal:wpaper:halshs-00564836 is not listed on IDEAS

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