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The Role of Social Ties in Explaining Heterogeneity in the Association Between Economic Growth and Subjective Well-Being

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  • Petri Böckerman

    () (Turku School of Economics
    Labour Institute for Economic Research
    IZA)

  • Jani-Petri Laamanen

    () (University of Tampere)

  • Esa Palosaari

    () (University of Tampere
    Aalto University
    HECER)

Abstract

Abstract Whether economic growth improves subjective well-being has been under debate. Studies that find such an association also document heterogeneity between countries in the magnitude of the relationship. We test a theoretical model in which economic growth enhances subjective well-being only when a large share of the population derives their subjective well-being from relational goods with positive externalities instead of positional goods with negative externalities. The choice between relational and positional goods is determined by individuals’ relational abilities and expectations which we operationalize as attachment security. We specifically test whether economic growth improves subjective well-being more in those countries where the average attachment security is higher. We find support for the hypothesis in the Eurobarometer data but less support in the World Values Survey data.

Suggested Citation

  • Petri Böckerman & Jani-Petri Laamanen & Esa Palosaari, 2016. "The Role of Social Ties in Explaining Heterogeneity in the Association Between Economic Growth and Subjective Well-Being," Journal of Happiness Studies, Springer, vol. 17(6), pages 2457-2479, December.
  • Handle: RePEc:spr:jhappi:v:17:y:2016:i:6:d:10.1007_s10902-015-9702-0
    DOI: 10.1007/s10902-015-9702-0
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    References listed on IDEAS

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    More about this item

    Keywords

    Economic growth; Subjective well-being; Easterlin paradox; Comparison income;

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • E03 - Macroeconomics and Monetary Economics - - General - - - Behavioral Macroeconomics

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