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Positional Concerns through the Life Cycle: Evidence from Subjective Well-Being Data and Survey Experiments

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  • Akay, Alpaslan

    ()
    (University of Gothenburg)

  • Martinsson, Peter

    ()
    (University of Gothenburg)

Abstract

This paper uses both subjective well-being and survey experimental data to analyze how people's positional concerns regarding income and goods vary with age. The subjective well-being approach is mainly based on German panel data for the period 1984-2009 (German Socio-Economic Panel), while the survey experimental approach is based on a tailor-made experimental design conducted among Swedish adults. Our analysis suggests that the degree of positional concerns is not homogenous across the life cycle. Our different analytical approaches show a robust life cycle pattern of positional concerns: young people experience no or a low degree of positional concerns, yet the level of concerns for income increases gradually and significantly with age. The results also differ across goods: while car consumption is similar to income, the positional concern for leisure time decreases through the life cycle.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6342.

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Length: 47 pages
Date of creation: Feb 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6342

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Keywords: positional concerns; life cycle; subjective well-being; survey experiment;

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Cited by:
  1. FitzRoy, Felix & Nolan, Michael A. & Steinhardt, Max & Ulph, David, 2013. "Testing the Tunnel Effect: Comparison, Age and Happiness in UK and German Panels," IZA Discussion Papers 7452, Institute for the Study of Labor (IZA).
  2. Vendrik, Maarten C.M., 2013. "Adaptation, anticipation and social interaction in happiness: An integrated error-correction approach," Journal of Public Economics, Elsevier, vol. 105(C), pages 131-149.
  3. Santi Budria & Ada Ferrer-i-Carbonell, 2012. "Income Comparisons and Non-cognitive Skills," SOEPpapers on Multidisciplinary Panel Data Research 441, DIW Berlin, The German Socio-Economic Panel (SOEP).
  4. Santi Budria & Ada Ferrer-i-Carbonell, 2013. "Income Comparisons and Non-Cognitive Skills," Working Papers 733, Barcelona Graduate School of Economics.
  5. Budría, Santiago & Ferrer-i-Carbonell, Ada, 2012. "Income Comparisons and Non-Cognitive Skills," IZA Discussion Papers 6419, Institute for the Study of Labor (IZA).

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