Measuring the Monetary Value of Social Relations: a Hedonic Approach
AbstractThis paper presents an application of the hedonic approach to measure the monetary price of social relations. We use individual-level data for housing and labor markets in 103 Italian cities to estimate the price of relational amenities and construct monetary indexes of quality of relational life. We focus on time spent with friends, active participation in associations and frequency of going out for leisure activities, while controlling for standard amenities such as weather, environment, services, and socio-demographic characteristics. We find that individuals are willing to pay a positive and significant monetary price to live in cities where people spend more time with their friends. A one standard deviation increase in the share of those who meet their friends most frequently is worth an extra \euro 1,150 per year in terms of higher housing costs and foregone wages.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Milano-Bicocca, Department of Economics in its series Working Papers with number 256.
Date of creation: Oct 2013
Date of revision: Oct 2013
social relations; social capital; hedonic prices; quality of life; well-being;
Find related papers by JEL classification:
- A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
- C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics
- D6 - Microeconomics - - Welfare Economics
- I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
- R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
- Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Social and Economic Stratification
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-10-18 (All new papers)
- NEP-HAP-2013-10-18 (Economics of Happiness)
- NEP-LTV-2013-10-18 (Unemployment, Inequality & Poverty)
- NEP-SOC-2013-10-18 (Social Norms & Social Capital)
- NEP-URE-2013-10-18 (Urban & Real Estate Economics)
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.:
- Knack, Stephen & Keefer, Philip, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1251-88, November.
- Stanca, Luca, 2009.
"With or without you? Measuring the quality of relational life throughout the world,"
Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics),
Elsevier, vol. 38(5), pages 834-842, October.
- Luca Stanca, 2008. "With or Without You? Measuring the Quality of Relational Life Throughout the World," Working Papers 144, University of Milano-Bicocca, Department of Economics, revised Jul 2008.
- Sarracino, Francesco, 2010. "Social capital and subjective well-being trends: Comparing 11 western European countries," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(4), pages 482-517, August.
- Emilio Colombo & Alessandra Michelangeli & Luca Stanca, 2010. "La Dolce Vita: Hedonic Estimates of Quality of Life in Italian Cities," Working Papers 201, University of Milano-Bicocca, Department of Economics, revised Dec 2010.
- Bernard M.S. van Praag & B.E. Baarsma, 2004.
"Using Happiness Surveys to value Intangibles; the Case of Airport Noise,"
Tinbergen Institute Discussion Papers
04-024/3, Tinbergen Institute.
- 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, vol. 115(500), pages 224-246, 01.
- Bernard M.S. van Praag & Barbara E. Baarsma, 2004. "Using Happiness Surveys to Value Intangibles: The Case of Airport Noise," CESifo Working Paper Series 1163, CESifo Group Munich.
- van Praag, Bernard M. S. & Baarsma, Barbara E., 2004. "Using Happiness Surveys to Value Intangibles: The Case of Airport Noise," IZA Discussion Papers 1096, Institute for the Study of Labor (IZA).
- Steven N. Durlauf, 2002.
"On the Empirics of Social Capital,"
Royal Economic Society, vol. 112(483), pages 459-479, November.
- Christian Bjornskov, 2003. "The Happy Few: Cross--Country Evidence on Social Capital and Life Satisfaction," Kyklos, Wiley Blackwell, vol. 56(1), pages 3-16, February.
- Leonardo Becchetti & Elena Giachin Ricca & Alessandra Pelloni, 2012. "The Relationship Between Social Leisure and Life Satisfaction: Causality and Policy Implications," Social Indicators Research, Springer, vol. 108(3), pages 453-490, September.
- Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-78, December.
- Diwan, Romesh, 2000. "Relational wealth and the quality of life," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 29(4), pages 305-340, July.
- John F. Helliwell, 2006.
"Well-Being, Social Capital and Public Policy: What's New?,"
Royal Economic Society, vol. 116(510), pages C34-C45, 03.
- John Helliwell, 2005. "Well-Being, Social Capital and Public Policy: What's New?," NBER Working Papers 11807, National Bureau of Economic Research, Inc.
- Bjornskov, Christian, 2006. "The multiple facets of social capital," European Journal of Political Economy, Elsevier, vol. 22(1), pages 22-40, March.
- Bruno Frey & Simon Luechinger & Alois Stutzer, 2009. "The life satisfaction approach to valuing public goods: The case of terrorism," Public Choice, Springer, vol. 138(3), pages 317-345, March.
- Bruni, Luigino & Stanca, Luca, 2008.
"Watching alone: Relational goods, television and happiness,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 65(3-4), pages 506-528, March.
- Luigino Bruni & Luca Stanca, 2005. "Watching alone: Relational Goods, Television and Happiness," Working Papers 90, University of Milano-Bicocca, Department of Economics, revised Jun 2005.
- Simon Moore & Jonathan Shepherd, 2006. "The cost of fear: shadow pricing the intangible costs of crime," Applied Economics, Taylor & Francis Journals, vol. 38(3), pages 293-300.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roberto Reale).
If references are entirely missing, you can add them using this form.