IDEAS home Printed from https://ideas.repec.org/a/spr/anresc/v74y2025i3d10.1007_s00168-025-01415-0.html
   My bibliography  Save this article

Subjective well-being and regional productivity in the European Union

Author

Listed:
  • Martijn Burger

    (Erasmus University Rotterdam
    Open University of the Netherlands
    University of Johannesburg)

  • Sarah Courchesne

    (Open University of the Netherlands)

  • Ilias Kostarakos

    (European Commission)

  • Chiara Peroni

    (STATEC Research)

  • Francesco Sarracino

    (STATEC Research)

  • Spyridon Stavropoulos

    (University of Patras)

Abstract

In this study, we examine the relationship between total factor productivity (TFP) and subjective well-being (SWB) in European regions. Using OLS and Lewbel IV estimators, we find a significant and positive effect of SWB on TFP. On average, regions that score 1-point higher on SWB report 19% higher TFP levels. Since TFP is an important driver of economic growth, these findings indicate that promoting SWB will benefit economic growth at the regional level.

Suggested Citation

  • Martijn Burger & Sarah Courchesne & Ilias Kostarakos & Chiara Peroni & Francesco Sarracino & Spyridon Stavropoulos, 2025. "Subjective well-being and regional productivity in the European Union," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 74(3), pages 1-25, September.
    • Handle: RePEc:spr:anresc:v:74:y:2025:i:3:d:10.1007_s00168-025-01415-0
    DOI: 10.1007/s00168-025-01415-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00168-025-01415-0
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00168-025-01415-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Caselli, Francesco, 2005. "Accounting for Cross-Country Income Differences," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 9, pages 679-741, Elsevier.
    2. Roberta Capello & Camilla Lenzi, 2015. "Knowledge, Innovation and Productivity Gains across European Regions," Regional Studies, Taylor & Francis Journals, vol. 49(11), pages 1788-1804, November.
    3. Caroline T. Witte & Martijn J. Burger & Elena Ianchovichina, 2020. "Subjective Well‐Being and Peaceful Uprisings," Kyklos, Wiley Blackwell, vol. 73(1), pages 120-158, February.
    4. Ciziceno, Marco & Pizzuto, Pietro, 2022. "Life satisfaction and tax morale: The role of trust in government and cultural orientation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 97(C).
    5. Clément S. Bellet & Jan-Emmanuel De Neve & George Ward, 2024. "Does Employee Happiness Have an Impact on Productivity?," Management Science, INFORMS, vol. 70(3), pages 1656-1679, March.
    6. Adam B. Jaffe & Manuel Trajtenberg & Rebecca Henderson, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 577-598.
    7. Wessel M. Ouwehand & Frank G. van Oort & Nicola Cortinovis, 2022. "Spatial structure and productivity in European regions," Regional Studies, Taylor & Francis Journals, vol. 56(1), pages 48-62, January.
    8. Matthias Siller & Thomas Schatzer & Janette Walde & Gottfried Tappeiner, 2021. "What drives total factor productivity growth? An examination of spillover effects," Regional Studies, Taylor & Francis Journals, vol. 55(6), pages 1129-1139, June.
    9. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 5266, London School of Economics and Political Science, LSE Library.
    10. Andrés Rodríguez-Pose & Roberto Ganau, 2022. "Institutions and the productivity challenge for European regions," Journal of Economic Geography, Oxford University Press, vol. 22(1), pages 1-25.
    11. Barro, Robert J. & Lee, Jong Wha, 2013. "A new data set of educational attainment in the world, 1950–2010," Journal of Development Economics, Elsevier, vol. 104(C), pages 184-198.
    12. Andrew J. Oswald & Eugenio Proto & Daniel Sgroi, 2015. "Happiness and Productivity," Journal of Labor Economics, University of Chicago Press, vol. 33(4), pages 789-822.
    13. Agnieszka Gehringer & Inmaculada Martínez-Zarzoso & Felicitas Nowak-Lehmann Danzinger, 2016. "What are the drivers of total factor productivity in the European Union?," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 25(4), pages 406-434, June.
    14. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(1), pages 83-116.
    15. Angrist, J D & Imbens, G W & Krueger, A B, 1999. "Jackknife Instrumental Variables Estimation," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(1), pages 57-67, Jan.-Feb..
    16. George Ward, 2020. "Happiness and Voting: Evidence from Four Decades of Elections in Europe," American Journal of Political Science, John Wiley & Sons, vol. 64(3), pages 504-518, July.
    17. Brian P. Poi, 2006. "Jackknife instrumental variables estimation in Stata," Stata Journal, StataCorp LLC, vol. 6(3), pages 364-376, September.
    18. Rehman, Naqeeb Ur & Nunziante, Giulia, 2023. "The effect of the digital economy on total factor productivity in European regions," Telecommunications Policy, Elsevier, vol. 47(10).
    19. Philip S. Morrison & Mikko Weckroth, 2018. "Human values, subjective well-being and the metropolitan region," Regional Studies, Taylor & Francis Journals, vol. 52(3), pages 325-337, March.
    20. Arthur Lewbel, 2012. "Using Heteroscedasticity to Identify and Estimate Mismeasured and Endogenous Regressor Models," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 30(1), pages 67-80.
    21. Louise Reardon & Saamah Abdallah, 2013. "Well-being and Transport: Taking Stock and Looking Forward," Transport Reviews, Taylor & Francis Journals, vol. 33(6), pages 634-657, November.
    22. Charles Henri DiMaria & Chiara Peroni & Francesco Sarracino, 2020. "Happiness Matters: Productivity Gains from Subjective Well-Being," Journal of Happiness Studies, Springer, vol. 21(1), pages 139-160, January.
    23. Matteo Migheli, 2017. "Size of Town, Level of Education and Life Satisfaction in Western Europe," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 108(2), pages 190-204, April.
    24. Philip McCann & Raquel Ortega-Argil�s, 2015. "Smart Specialization, Regional Growth and Applications to European Union Cohesion Policy," Regional Studies, Taylor & Francis Journals, vol. 49(8), pages 1291-1302, August.
    25. Martijn J. Burger & Susanna Eiselt, 2023. "Subjective Well-Being and Populist Voting in the Netherlands," Journal of Happiness Studies, Springer, vol. 24(7), pages 2331-2352, October.
    26. Annie Tubadji & Martijn Burger & Don J. Webber, 2025. "Geographies of feeling stuck behind and populist voting in The Netherlands," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 179(1), pages 549-579, August.
    27. Nicola Cortinovis & Frank van Oort, 2019. "Between spilling over and boiling down: network-mediated spillovers, local knowledge base and productivity in European regions," Journal of Economic Geography, Oxford University Press, vol. 19(6), pages 1233-1260.
    28. Sjoerd Beugelsdijk & Mariko J. Klasing & Petros Milionis, 2018. "Regional economic development in Europe: the role of total factor productivity," Regional Studies, Taylor & Francis Journals, vol. 52(4), pages 461-476, April.
    29. Efstratia Arampatzi & Martijn Burger & Elena Ianchovichina & Tina Röhricht & Ruut Veenhoven, 2018. "Unhappy Development: Dissatisfaction With Life on the Eve of the Arab Spring," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(s1), pages 80-113, October.
    30. Caselli, Francesco, 2005. "Accounting for cross-country income differences," LSE Research Online Documents on Economics 3567, London School of Economics and Political Science, LSE Library.
    31. Kadri Männasoo & Heili Hein & Raul Ruubel, 2018. "The contributions of human capital, R&D spending and convergence to total factor productivity growth," Regional Studies, Taylor & Francis Journals, vol. 52(12), pages 1598-1611, December.
    32. Rasheed, Farooq & Rauf, Shahnaz A & Ahmad, Eatzaz, 2011. "Happiness in Solow Growth Model," MPRA Paper 43400, University Library of Munich, Germany, revised 30 Oct 2011.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Emanuela Marrocu & Raffaele Paci & Stefano Usai, 2022. "Direct and indirect effects of universities on European regional productivity," Papers in Regional Science, Wiley Blackwell, vol. 101(5), pages 1105-1133, October.
    2. Le, Thanh & Vu Bich, Ngoc & Mai, Sau, 2023. "Frontier academic research in OECD countries: the role of institutional factors," Journal of Institutional Economics, Cambridge University Press, vol. 19(4), pages 526-547, August.
    3. Löschel, Andreas & Pothen, Frank & Schymura, Michael, 2015. "Peeling the onion: Analyzing aggregate, national and sectoral energy intensity in the European Union," Energy Economics, Elsevier, vol. 52(S1), pages 63-75.
    4. Uwe Sunde & Thomas Dohmen & Benjamin Enke & Armin Falkbriq & David Huffman & Gerrit Meyerheim, 2022. "Patience and Comparative Development," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 89(5), pages 2806-2840.
    5. Dany Bahar, 2017. "The Hardships of Long Distance Relationships: Knowledge Transmission and the Ease of Communication within Multinational Firms," Growth Lab Working Papers 102, Harvard's Growth Lab.
    6. Rui Castro & Pavel Ševčík, 2024. "Occupational choice, human capital and financial constraints," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 57(3), pages 674-703, August.
    7. Michael Schymura & Andreas Löschel, 2012. "Trade and the Environment: An Application of the WIOD Database," EcoMod2012 3948, EcoMod.
    8. Hanushek, Eric A. & Woessmann, Ludger, 2012. "Schooling, educational achievement, and the Latin American growth puzzle," Journal of Development Economics, Elsevier, vol. 99(2), pages 497-512.
    9. Acikgoz, Senay & Ben Ali, Mohamed Sami, 2019. "Where does economic growth in the Middle Eastern and North African countries come from?," The Quarterly Review of Economics and Finance, Elsevier, vol. 73(C), pages 172-183.
    10. Alexander Monge-Naranjo & Juan M. Sánchez & Raül Santaeulàlia-Llopis, 2019. "Natural Resources and Global Misallocation," American Economic Journal: Macroeconomics, American Economic Association, vol. 11(2), pages 79-126, April.
    11. Aisen, Ari & Veiga, Francisco José, 2013. "How does political instability affect economic growth?," European Journal of Political Economy, Elsevier, vol. 29(C), pages 151-167.
    12. German Cubas & B. Ravikumar & Gustavo Ventura, 2016. "Talent, Labor Quality, and Economic Development," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 21, pages 160-181, July.
    13. Valero, Anna & Van Reenen, John, 2019. "The economic impact of universities: Evidence from across the globe," Economics of Education Review, Elsevier, vol. 68(C), pages 53-67.
    14. Zymek, Robert, 2015. "Factor proportions and the growth of world trade," Journal of International Economics, Elsevier, vol. 95(1), pages 42-53.
    15. Barker, Tom & Üngör, Murat, 2019. "Vietnam: The next asian Tiger?," The North American Journal of Economics and Finance, Elsevier, vol. 47(C), pages 96-118.
    16. Jones, C.I., 2016. "The Facts of Economic Growth," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 3-69, Elsevier.
    17. Konstantinos Chatzimichael & Vangelis Tzouvelekas, 2014. "Human capital contributions to explain productivity differences," Journal of Productivity Analysis, Springer, vol. 41(3), pages 399-417, June.
    18. David Lagakos & Benjamin Moll & Tommaso Porzio & Nancy Qian & Todd Schoellman, 2018. "Life-Cycle Human Capital Accumulation across Countries: Lessons from US Immigrants," Journal of Human Capital, University of Chicago Press, vol. 12(2), pages 305-342.
    19. Robert Zymek & Alejandro Cunat, 2017. "International Value-Added Linkages in Development Accounting," 2017 Meeting Papers 1136, Society for Economic Dynamics.
    20. Remi Jedwab & Paul Romer & Asif M. Islam & Roberto Samaniego, 2023. "Human Capital Accumulation at Work: Estimates for the World and Implications for Development," American Economic Journal: Macroeconomics, American Economic Association, vol. 15(3), pages 191-223, July.

    More about this item

    Keywords

    ;
    ;

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:anresc:v:74:y:2025:i:3:d:10.1007_s00168-025-01415-0. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.