Monetary policy and happiness: Preferences over inflation and unemployment in Latin America
Using subjective well-being survey data for Latin America, we present evidence that both inflation and unemployment reduce well-being; where the cost of inflation in terms of unemployment, hence the relative size of the weights in a social well-being functions, is about one to eight, almost double of that found for OECD countries. The trade-off, and therefore the misery index, differs across subgroups. For example, the young and left-leaning citizens are more concerned with unemployment than inflation.
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Volume (Year): 40 (2011)
Issue (Month): 1 (February)
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