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The social consequences of economic growth: The relationship between real household income and self-declared tolerance

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BECCHETTI LEONARDO
CASTRIOTA STEFANO
ROSSETTI FIAMMETTA

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Abstract

A widespread opinion, supported by many theoretical contributions of philosophers and economists, states that economic prosperity has positive consequences on material wellbeing which are traded off by negative “moral” consequences and social externalities. An opposite school of thought challenges this view by emphasizing that economic growth has also beneficial moral consequences in terms of higher tolerance, affection towards democracy, generosity and social consensus for competition. This paper focuses on the presumed positive effect of economic growth on tolerance, so far unexplored in the literature from an empirical point of view. Using panel data from the German Socioeconomic Panel on around 33,000 individuals over the period 1992-2004 we find a robust positive relationship between real personal household income and self-declared tolerance, both in levels and first differences. Our results suggest that growth may have positive moral consequences assumed that it translates from aggregate into individual level.

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Paper provided by Tor Vergata University, CEIS in its series Departmental Working Papers with number 254.

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Date of creation: Jul 2007
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Handle: RePEc:rtv:ceiswp:254

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  1. Leonardo Becchetti & Luisa Corrado & Fiammetta Rossetti, 2008. "Easterlin-types and Frustrated Achievers: the Heterogeneous E¤ects of Income Changes on Life Satisfaction," CEIS Research Paper 127, Tor Vergata University, CEIS, revised 09 Sep 2008. [Downloadable!]
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