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Climbing up the Social Ladders: Identity, Relative Income, and Subjective Well-being

  • Wen-Chun Chang

    ()

This study incorporates the concept of identity to explain the relationship between relative income and subjective well-being. Based upon the theoretical framework of an identity model developed by Akerlof and Kranton Q J Econ 115:715–753, ( 2000 ), the empirical findings of this study suggest that an increase in relative income leads to a gain in positional identity and therefore raises the level of subjective well-being. This approach extends our understanding about the connection between positional concern and subjective well-being and explains the importance of social comparison in shaping individuals’ preferences and tastes. People are concerned about their relative income as it represents a positional identity of social status, dependent upon ideals and norms derived from the interactions between an individual and others within a society. Copyright Springer Science+Business Media B.V. 2013

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File URL: http://hdl.handle.net/10.1007/s11205-012-0108-7
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Article provided by Springer in its journal Social Indicators Research.

Volume (Year): 113 (2013)
Issue (Month): 1 (August)
Pages: 513-535

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Handle: RePEc:spr:soinre:v:113:y:2013:i:1:p:513-535
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