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Isolation and Subjective Welfare

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  • Marcel Fafchamps
  • Forhad Shilpi

Abstract

Using detailed geographical and household survey data from Nepal, this article investigates the relationship between isolation and subjective welfare. This is achieved by examining how distance to markets and proximity to large urban centers affect responses to questions about income and consumption adequacy. Controlling for migration, results show that isolation significantly reduce subjective assessments of income and consumption adequacy. Part of this effect can be attributed to lower access to public goods and to a reduction in the variety of consumption items. Compensating variation estimates suggest that the subjective cost of isolation is large. We also find strong evidence that Nepalese households cannot relocate costlessly out of their village of origin.

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Bibliographic Info

Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 216.

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Date of creation: 01 Dec 2004
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Handle: RePEc:oxf:wpaper:216

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Keywords: Geographical Isolation; Subjective Well-Being; Migration;

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Citations

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Cited by:
  1. Fafchamps, Marcel & Shilpi, Forhad, 2006. "Subjective Welfare, Isolation and Relative Consumption," CEPR Discussion Papers, C.E.P.R. Discussion Papers 6002, C.E.P.R. Discussion Papers.
  2. Asadullah, Niaz & Chaudhury, Nazmul, 2012. "Subjective Well-Being and Relative Poverty in Rural Bangladesh," IZA Discussion Papers 6569, Institute for the Study of Labor (IZA).
  3. Marcel Fafchamps & Forhad Shilpi, 2010. "Determinants of the Choice of Migration Destination," Working Papers id:2450, eSocialSciences.
  4. Guillen-Royo, Monica, 2011. "Reference group consumption and the subjective wellbeing of the poor in Peru," Journal of Economic Psychology, Elsevier, Elsevier, vol. 32(2), pages 259-272, March.
  5. Francken, Nathalie & Minten, Bart & Swinnen, Johan F.M., 2009. "Media, Monitoring, and Capture of Public Funds: Evidence from Madagascar," World Development, Elsevier, Elsevier, vol. 37(1), pages 242-255, January.
  6. Charles Kenny, 2011. "Bentham from the Crypt Once More: Politicians in Pursuit of Happiness," Working Papers id:4332, eSocialSciences.

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