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Allowing for heterogeneity in monetary subjective well‐being valuations


  • Emmanouil Mentzakis


Recent research on ‘happiness’ regression equations has shown how monetary values can be put on the well-being effects of many life events (like health problems, marriage or the death of a spouse). Potentially, such work has practical implications for policy‐makers and the courts. However, this article argues that we need to be careful in such work to use the appropriate statistical method. It goes beyond previous research and allows for heterogeneity in the subjective well‐being scales. Using less restrictive models than the current literature, the article argues that standard linear or ordered response models seem consistently to overstate valuations. With data from the UK, it provides new monetary estimates of the well‐being consequences of a number of health problems, social capital indicators, marital status changes and social relationships. Copyright (C) 2010 John Wiley & Sons, Ltd.

Suggested Citation

  • Emmanouil Mentzakis, 2011. "Allowing for heterogeneity in monetary subjective well‐being valuations," Health Economics, John Wiley & Sons, Ltd., vol. 20(3), pages 331-347, March.
  • Handle: RePEc:wly:hlthec:v:20:y:2011:i:3:p:331-347

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    References listed on IDEAS

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    Cited by:

    1. Dusanee Kesavayuth & Robert Rosenman & Vasileios Zikos, 2013. "Does Personality Affect how People Perceive their Health?," Working Papers 2013-13, School of Economic Sciences, Washington State University.
    2. Mentzakis, Emmanouil & Suhrcke, Marc & Roberts, Bayard & Murphy, Adrianna & McKee, Martin, 2013. "Estimating the causal effect of alcohol consumption on well-being for a cross-section of 9 former Soviet Union countries," Social Science & Medicine, Elsevier, vol. 89(C), pages 1-7.
    3. Stefan Boes & Stephan Nüesch & Steven Stillman, 2013. "Aircraft Noise, Health, And Residential Sorting: Evidence From Two Quasi‐Experiments," Health Economics, John Wiley & Sons, Ltd., vol. 22(9), pages 1037-1051, September.
    4. Emmanouil Mentzakis & Paul McNamee & Mandy Ryan & Matthew Sutton, 2012. "Valuing Informal Care Experience: Does Choice of Measure Matter?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 108(1), pages 169-184, August.
    5. Andos Juhász, 2012. "A Satisfaction-Driven Poverty Indicator: A Bustle around the Poverty Line," SOEPpapers on Multidisciplinary Panel Data Research 461, DIW Berlin, The German Socio-Economic Panel (SOEP).
    6. Chongvilaivan, Aekapol & Powdthavee, Nattavudh, 2011. "And I Will Try to Fix You: A Study of Heterogeneity in Job Satisfaction with Implications for Flexible Employment Contracts," IZA Discussion Papers 5868, Institute for the Study of Labor (IZA).
    7. Howley, Peter, 2017. "Less money or better health? Evaluating individual’s willingness to make trade-offs using life satisfaction data," Journal of Economic Behavior & Organization, Elsevier, vol. 135(C), pages 53-65.
    8. Hancock, Ruth & Morciano, Marcello & Pudney, Stephen, 2013. "Nonparametric estimation of a compensating variation: the cost of disability," ISER Working Paper Series 2013-26, Institute for Social and Economic Research.
    9. Howley, P., 2016. "Valuing the benefits from health care interventions using life satisfaction data," Health, Econometrics and Data Group (HEDG) Working Papers 16/01, HEDG, c/o Department of Economics, University of York.
    10. Powdthavee, Nattavudh & van den Berg, Bernard, 2011. "Putting different price tags on the same health condition: Re-evaluating the well-being valuation approach," Journal of Health Economics, Elsevier, vol. 30(5), pages 1032-1043.
    11. Orlowski, Johannes & Wicker, Pamela, 2015. "The monetary value of social capital," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 57(C), pages 26-36.


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