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Deprivation and Subjective Well-Being: Evidence from Panel Data

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  • Maite Blázquez Cuesta
  • Santiago Budría

Abstract

type="main"> This paper uses data from the 2000–08 waves of the German Socio-Economic Panel dataset (SOEP) to assess the impact of deprivation in various life domains upon individual well-being. Unobserved heterogeneity is controlled for by means of a random effects model extended to include a Mundlak term and explicit controls for the respondents' personality traits. The paper shows that people care about social comparison information in a number of domains, not just income. Using an equivalent income approach, the estimates suggest that a one standard deviation deterioration of the individual position in the income distribution is as important as a 33.5 percent decrease in own income. This monetary equivalent amounts to an income variation of between 25 and 43 percent when it comes to other deprivation domains, including durables, accommodation, health, and social relations. These results recommend that in the fight against deprivation more emphasis should be directed to these non-monetary relevant dimensions.

Suggested Citation

  • Maite Blázquez Cuesta & Santiago Budría, 2014. "Deprivation and Subjective Well-Being: Evidence from Panel Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(4), pages 655-682, December.
  • Handle: RePEc:bla:revinw:v:60:y:2014:i:4:p:655-682
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    2. Hortay, Olivér & Kökény, László & Stefkovics, Ádám, 2021. "A szubjektív energiaszegénység mérésének problémái Magyarországon [Problems with measuring subjective energy poverty in Hungary]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 753-772.
    3. Sinha, Kompal & Davillas, Apostolos & Jones, Andrew M. & Sharma, Anurag, 2018. "Distributional analysis of the role of breadth and persistence of multiple deprivation in the health gradient measured by biomarkers," ISER Working Paper Series 2018-14, Institute for Social and Economic Research.
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    5. María Navarro & Wiemer Salverda, 2019. "Earner Position and Job and Life Satisfaction: Do Contributions to the Household Income have the Same Effect by Gender and Occupations?," Journal of Happiness Studies, Springer, vol. 20(7), pages 2227-2250, October.

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    More about this item

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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