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Income, happiness, and the disutility of labour


  • Knabe, Andreas
  • Rätzel, Steffen


We re-examine the claim that the income effect on happiness is downward biased because higher income demands more work effort. We find no evidence of an underestimation because the impact of working hours on happiness is rather small and hill-shaped.

Suggested Citation

  • Knabe, Andreas & Rätzel, Steffen, 2010. "Income, happiness, and the disutility of labour," Economics Letters, Elsevier, vol. 107(1), pages 77-79, April.
  • Handle: RePEc:eee:ecolet:v:107:y:2010:i:1:p:77-79

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    References listed on IDEAS

    1. AlisonL. Booth & JanC. vanOurs, 2008. "Job Satisfaction and Family Happiness: The Part-Time Work Puzzle," Economic Journal, Royal Economic Society, vol. 118(526), pages 77-99, February.
    2. Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, Oxford University Press, vol. 120(3), pages 963-1002.
    3. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2008. "Relative Income, Happiness, and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," Journal of Economic Literature, American Economic Association, vol. 46(1), pages 95-144, March.
    4. repec:dgr:kubcen:200769 is not listed on IDEAS
    5. Pouwels, Babette & Siegers, Jacques & Vlasblom, Jan Dirk, 2008. "Income, working hours, and happiness," Economics Letters, Elsevier, vol. 99(1), pages 72-74, April.
    6. Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, July.
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    Cited by:

    1. Peter H Van Der Meer & Rudi Wielers, 2011. "What makes workers happy?," Post-Print hal-00734530, HAL.
    2. Homann, Malte & Jensen, Uwe, 2013. "Does better education cause higher income?," HWWI Research Papers 145, Hamburg Institute of International Economics (HWWI).
    3. Akay, Alpaslan & Bargain, Olivier & Jara, Xavier, 2017. "Back to Bentham, Should We? Large-Scale Comparison of Experienced versus Decision Utility," IZA Discussion Papers 10907, Institute for the Study of Labor (IZA).
    4. Gerritsen, Aart, 2016. "Optimal taxation when people do not maximize well-being," Journal of Public Economics, Elsevier, vol. 144(C), pages 122-139.
    5. Robert Rudolf, 2014. "Work Shorter, Be Happier? Longitudinal Evidence from the Korean Five-Day Working Policy," Journal of Happiness Studies, Springer, vol. 15(5), pages 1139-1163, October.
    6. Akay, Alpaslan & Bargain, Olivier B. & Jara, H. Xavier, 2017. "Back to Bentham, Should We? Large-Scale Comparison of Experienced versus Decision Utility," GLO Discussion Paper Series 52, Global Labor Organization (GLO).

    More about this item


    Happiness Life satisfaction Income Working hours;

    JEL classification:

    • D60 - Microeconomics - - Welfare Economics - - - General
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being


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