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Can policy make us happier? Individual characteristics, socio-economic factors and life satisfaction in Central and Eastern Europe

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  • Andrés Rodríguez-Pose
  • Kristina Maslauskaite

Abstract

Rapid economic convergence in Central and Eastern European (CEE) countries has not been matched by a similarly rapid increase in life satisfaction. This paper sets out to address this conundrum, by looking at the individual and macro-level determinants of individual life satisfaction in 10 CEE countries. The results highlight that macroeconomic and institutional differences are the key factors behind the lack of convergence in life satisfaction. On the macroeconomic side, Gross Domestic Product growth is still a source of increasing well-being, but the happiness bonus associated with it is becoming smaller. The different levels of individual happiness in CEE are therefore mostly determined by institutional factors such as corruption, government spending and decentralization. Copyright 2011, Oxford University Press.

Suggested Citation

  • Andrés Rodríguez-Pose & Kristina Maslauskaite, 2011. "Can policy make us happier? Individual characteristics, socio-economic factors and life satisfaction in Central and Eastern Europe," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 5(1), pages 77-96.
  • Handle: RePEc:oup:cjrecs:v:5:y:2011:i:1:p:77-96
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    File URL: http://hdl.handle.net/10.1093/cjres/rsr038
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    References listed on IDEAS

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    1. Diaz-Serrano, Luis & Rodríguez-Pose, Andrés, 2011. "Decentralization, Happiness and the Perception of Institutions," IZA Discussion Papers 5647, Institute for the Study of Labor (IZA).
    2. Sergei Guriev & Ekaterina Zhuravskaya, 2009. "(Un)happiness in Transition," Journal of Economic Perspectives, American Economic Association, vol. 23(2), pages 143-168, Spring.
    3. Stefan Voigt & Lorenz Blume, 2012. "The economic effects of federalism and decentralization—a cross-country assessment," Public Choice, Springer, vol. 151(1), pages 229-254, April.
    4. Robert J. MacCulloch & Rafael Di Tella & Andrew J. Oswald, 2001. "Preferences over Inflation and Unemployment: Evidence from Surveys of Happiness," American Economic Review, American Economic Association, vol. 91(1), pages 335-341, March.
    5. Lelkes, Orsolya, 2006. "Knowing what is good for you: Empirical analysis of personal preferences and the "objective good"," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(2), pages 285-307, April.
    6. Frijters, Paul & Beatton, Tony, 2012. "The mystery of the U-shaped relationship between happiness and age," Journal of Economic Behavior & Organization, Elsevier, vol. 82(2), pages 525-542.
    7. Blanchflower, David G; Oswald, Andrew, 2011. "International Happiness," CAGE Online Working Paper Series 39, Competitive Advantage in the Global Economy (CAGE).
    8. Kaisa Kotakorpi & Jani-Petri Laamanen, 2010. "Welfare State and Life Satisfaction: Evidence from Public Health Care," Economica, London School of Economics and Political Science, vol. 77(307), pages 565-583, July.
    9. Heinz Welsch, 2008. "The welfare costs of corruption," Applied Economics, Taylor & Francis Journals, vol. 40(14), pages 1839-1849.
    10. Jan Ott, 2010. "Good Governance and Happiness in Nations: Technical Quality Precedes Democracy and Quality Beats Size," Journal of Happiness Studies, Springer, vol. 11(3), pages 353-368, June.
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    Cited by:

    1. Sergei Guriev & Ekaterina Zhuravskaya, 2009. "(Un)happiness in Transition," Journal of Economic Perspectives, American Economic Association, vol. 23(2), pages 143-168, Spring.
    2. Ręklewski Marek & Ryczkowski Maciej, 2016. "The Polish Regional Labour Market Welfare Indicator and Its Links to Other Well-being Measures," Comparative Economic Research, De Gruyter Open, vol. 19(3), pages 113-132, September.
    3. Asadullah, M. Niaz & Xiao, Saizi & Yeoh, Emile, 2018. "Subjective well-being in China, 2005–2010: The role of relative income, gender, and location," China Economic Review, Elsevier, vol. 48(C), pages 83-101.
    4. Nazim Habibov & Elvin Afandi, 2015. "Pre- and Post-crisis Life-Satisfaction and Social Trust in Transitional Countries: An Initial Assessment," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 121(2), pages 503-524, April.
    5. repec:rsr:journl:v:65:y:2017:i:2:p:21-41 is not listed on IDEAS
    6. Sujarwoto Sujarwoto & Gindo Tampubolon, 2015. "Decentralisation and Citizen Happiness: A Multilevel Analysis of Self-rated Happiness in Indonesia," Journal of Happiness Studies, Springer, vol. 16(2), pages 455-475, April.
    7. Cristina Bernini & Alessandro Tampieri, 2017. "Urbanization and its Effects on the Happiness Domains," CREA Discussion Paper Series 17-10, Center for Research in Economic Analysis, University of Luxembourg.
    8. repec:prg:jnlpep:v:preprint:id:658:p:1-18 is not listed on IDEAS
    9. Nikolova, Milena, 2016. "Minding the happiness gap: Political institutions and perceived quality of life in transition," European Journal of Political Economy, Elsevier, vol. 45(S), pages 129-148.
    10. Kalenborn, Christine & Lessmann, Christian, 2014. "Regional Income Inequality lowers Life Satisfaction: Evidence from OECD Countries," Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100561, Verein für Socialpolitik / German Economic Association.

    More about this item

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • P36 - Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

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