IDEAS home Printed from https://ideas.repec.org/p/cep/cepdps/dp1229.html
   My bibliography  Save this paper

Unmet Aspirations as an Explanation for the Age U-Shape in Human Wellbeing

Author

Listed:
  • Hannes Schwandt

Abstract

A large literature in behavioral and social sciences has found that human wellbeing follows a U-shape over age. Some theories have assumed that the U-shape is caused by unmet expectations that are felt painfully in midlife but beneficially abandoned and experienced with less regret during old age. In a unique panel of 132,609 life satisfaction expectations matched to subsequent realizations, I find people to err systematically in predicting their life satisfaction over the life cycle. They expect -- incorrectly -- increases in young adulthood and decreases during old age. These errors are large, ranging from 9.8% at age 21 to -4.5% at age 68, they are stable over time and observed across socio-economic groups. These findings support theories that unmet expectations drive the age U-shape in wellbeing.

Suggested Citation

  • Hannes Schwandt, 2013. "Unmet Aspirations as an Explanation for the Age U-Shape in Human Wellbeing," CEP Discussion Papers dp1229, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp1229
    as

    Download full text from publisher

    File URL: https://cep.lse.ac.uk/pubs/download/dp1229.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Van Landeghem, Bert, 2012. "A test for the convexity of human well-being over the life cycle: Longitudinal evidence from a 20-year panel," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 571-582.
    2. Weiss, Alexander & King, James E. & Inoue-Murayama, Miho & Matsuzawa, Tetsuro & Oswald, Andrew J., 2012. "Evidence for a ‘Midlife Crisis’ in Great Apes Consistent with the U-Shape in Human Well-Being," IZA Discussion Papers 7009, Institute of Labor Economics (IZA).
    3. Blanchflower, David G. & Oswald, Andrew J., 2008. "Is well-being U-shaped over the life cycle?," Social Science & Medicine, Elsevier, vol. 66(8), pages 1733-1749, April.
    4. repec:pri:cepsud:125krueger is not listed on IDEAS
    5. Bruno S. Frey, 2018. "Economics of Happiness," SpringerBriefs in Economics, Springer, number 978-3-319-75807-7, October.
    6. Alberto Alesina & Nicola Fuchs-Schundeln, 2005. "Good bye Lenin (or not?): The effect of Communism on people's preferences," Harvard Institute of Economic Research Working Papers 2076, Harvard - Institute of Economic Research.
    7. Guy Mayraz, 2011. "Wishful Thinking," CEP Discussion Papers dp1092, Centre for Economic Performance, LSE.
    8. Mayraz, Guy, 2011. "Wishful thinking," LSE Research Online Documents on Economics 121942, London School of Economics and Political Science, LSE Library.
    9. Easterlin, Richard A, 2001. "Income and Happiness: Towards an Unified Theory," Economic Journal, Royal Economic Society, vol. 111(473), pages 465-484, July.
    10. 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.
    11. Daniel J. Benjamin & Ori Heffetz & Miles S. Kimball & Alex Rees-Jones, 2012. "What Do You Think Would Make You Happier? What Do You Think You Would Choose?," American Economic Review, American Economic Association, vol. 102(5), pages 2083-2110, August.
    12. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2008. "Relative Income, Happiness, and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," Journal of Economic Literature, American Economic Association, vol. 46(1), pages 95-144, March.
    13. Tali Sharot & Alison M. Riccardi & Candace M. Raio & Elizabeth A. Phelps, 2007. "Neural mechanisms mediating optimism bias," Nature, Nature, vol. 450(7166), pages 102-105, November.
    14. Daniel Kahneman & Richard H. Thaler, 2006. "Anomalies: Utility Maximization and Experienced Utility," Journal of Economic Perspectives, American Economic Association, vol. 20(1), pages 221-234, Winter.
    15. Puri, Manju & Robinson, David T., 2007. "Optimism and economic choice," Journal of Financial Economics, Elsevier, vol. 86(1), pages 71-99, October.
    16. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP) – Scope, Evolution and Enhancements," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(1), pages 139-169.
    17. Daniel Kahneman & Alan B. Krueger & David Schkade & Norbert Schwarz & Arthur A. Stone, 2006. "Would You Be Happier If You Were Richer? A Focusing Illusion," Working Papers 77, Princeton University, Department of Economics, Center for Economic Policy Studies..
    18. Arthur A. Stone & Joseph E. Schwartz & Joan E. Broderick & Angus Deaton, 2010. "A snapshot of the age distribution of psychological well-being in the United States," Working Papers 1230, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
    19. Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, July.
    20. Oswald, Andrew J. & Wu, Stephen, 2010. "Objective Confirmation of Subjective Measures of Human Well-being: Evidence from the USA," IZA Discussion Papers 4695, Institute of Labor Economics (IZA).
    21. Daniel Kahneman & Alan B. Krueger & David Schkade & Norbert Schwarz & Arthur A. Stone, 2006. "Would You Be Happier If You Were Richer? A Focusing Illusion," Working Papers 77, Princeton University, Department of Economics, Center for Economic Policy Studies..
    Full references (including those not matched with items on IDEAS)

    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Happiness, age & class
      by chris dillow in Stumbling and Mumbling on 2014-03-01 20:27:31

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Terence C. Cheng & Nattavudh Powdthavee & Andrew J. Oswald, 2017. "Longitudinal Evidence for a Midlife Nadir in Human Well‐being: Results from Four Data Sets," Economic Journal, Royal Economic Society, vol. 127(599), pages 126-142, February.
    2. Alan Piper, 2014. "Zukunftsangst! Fear of (and Hope for) the Future and Its Impact on Life Satisfaction," SOEPpapers on Multidisciplinary Panel Data Research 706, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. Reto Odermatt & Alois Stutzer, 2019. "(Mis-)Predicted Subjective Well-Being Following Life Events," Journal of the European Economic Association, European Economic Association, vol. 17(1), pages 245-283.
    4. Yongwei Chen & Ying Zhang, 2020. "Effects of free compulsory education on rural well‐being in China," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 34(2), pages 78-92, November.
    5. Marta Barazzetta, 2015. "The asymmetric effect of expectations on subjective well-being," Working Papers 374, ECINEQ, Society for the Study of Economic Inequality.
    6. Piper, Alan T., 2014. "Sliding down the U-shape? An investigation of the age-well-being relationship, with a focus on young adults," MPRA Paper 55819, University Library of Munich, Germany.
    7. Marco Bertoni & Luca Corazzini, 2015. "Life Satisfaction and Endogenous Aspirations," SOEPpapers on Multidisciplinary Panel Data Research 761, DIW Berlin, The German Socio-Economic Panel (SOEP).
    8. Bell, Andrew, 2014. "Life-course and cohort trajectories of mental health in the UK, 1991–2008 – A multilevel age–period–cohort analysis," Social Science & Medicine, Elsevier, vol. 120(C), pages 21-30.

    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. Schwandt, Hannes, 2016. "Unmet aspirations as an explanation for the age U-shape in wellbeing," Journal of Economic Behavior & Organization, Elsevier, vol. 122(C), pages 75-87.
    2. Junji Kageyama & Kazuma Sato, 2021. "Explaining the U-shaped life satisfaction: dissatisfaction as a driver of behavior," Journal of Bioeconomics, Springer, vol. 23(2), pages 179-202, July.
    3. Terence C. Cheng & Nattavudh Powdthavee & Andrew J. Oswald, 2017. "Longitudinal Evidence for a Midlife Nadir in Human Well‐being: Results from Four Data Sets," Economic Journal, Royal Economic Society, vol. 127(599), pages 126-142, February.
    4. Hania Wu & Tony Tam, 2015. "Economic Development and Socioeconomic Inequality of Well-Being: A Cross-Sectional Time-Series Analysis of Urban China, 2003–2011," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 124(2), pages 401-425, November.
    5. Blanchflower, David G. & Oswald, Andrew J., 2016. "Antidepressants and age: A new form of evidence for U-shaped well-being through life," Journal of Economic Behavior & Organization, Elsevier, vol. 127(C), pages 46-58.
    6. Adrian Chadi, 2019. "Dissatisfied with life or with being interviewed? Happiness and the motivation to participate in a survey," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 53(3), pages 519-553, October.
    7. Koen Decancq & Marc Fleurbaey & Erik Schokkaert, 2015. "Happiness, Equivalent Incomes and Respect for Individual Preferences," Economica, London School of Economics and Political Science, vol. 82, pages 1082-1106, December.
    8. Hilke Brockmann, 2009. "Why Are Middle-Aged People so Depressed?: Evidence from West Germany," SOEPpapers on Multidisciplinary Panel Data Research 233, DIW Berlin, The German Socio-Economic Panel (SOEP).
    9. O'Donnell, Gus & Oswald, Andrew J., 2015. "National well-being policy and a weighted approach to human feelings," Ecological Economics, Elsevier, vol. 120(C), pages 59-70.
    10. Biermann, Philipp & Bitzer, Jürgen & Gören, Erkan, 2022. "The relationship between age and subjective well-being: Estimating within and between effects simultaneously," The Journal of the Economics of Ageing, Elsevier, vol. 21(C).
    11. Francesco Ferrante, 2009. "Education, Aspirations and Life Satisfaction," Kyklos, Wiley Blackwell, vol. 62(4), pages 542-562, November.
    12. Van Landeghem, Bert, 2012. "A test for the convexity of human well-being over the life cycle: Longitudinal evidence from a 20-year panel," Journal of Economic Behavior & Organization, Elsevier, vol. 81(2), pages 571-582.
    13. Hilke Brockmann & Anne-Maren Koch & Adele Diederich & Christofer Edling, 2018. "Why Managerial Women are Less Happy Than Managerial Men," Journal of Happiness Studies, Springer, vol. 19(3), pages 755-779, March.
    14. David G. Blanchflower, 2021. "Is happiness U-shaped everywhere? Age and subjective well-being in 145 countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(2), pages 575-624, April.
    15. Reto Odermatt & Alois Stutzer, 2019. "(Mis-)Predicted Subjective Well-Being Following Life Events," Journal of the European Economic Association, European Economic Association, vol. 17(1), pages 245-283.
    16. Bert Van Landeghem, 2012. "Panel Conditioning and Self-Reported Satisfaction: Evidence from International Panel Data and Repeated Cross-Sections," SOEPpapers on Multidisciplinary Panel Data Research 484, DIW Berlin, The German Socio-Economic Panel (SOEP).
    17. Tekin Kose & Julide Yildirim & Gizem Tanrivere, 2017. "The Effects of Terrorism on Happiness: Evidence from Turkey," EcoMod2017 10229, EcoMod.
    18. Weiss, Alexander & King, James E. & Inoue-Murayama, Miho & Matsuzawa, Tetsuro & Oswald, Andrew J., 2012. "Evidence for a ‘Midlife Crisis’ in Great Apes Consistent with the U-Shape in Human Well-Being," IZA Discussion Papers 7009, Institute of Labor Economics (IZA).
    19. Teresa García-Muñoz & Shoshana Neuman & Tzahi Neuman, 2014. "Subjective Health Status of the Older Population: Is It Related to Country-Specific Economic Development Measures?," Working Papers 2014-02, Bar-Ilan University, Department of Economics.
    20. Eva M. Berger, 2008. "A Note on the High Stability of Happiness: The Minimal Effects of a Nuclear Catastrophe on Life Satisfaction," Discussion Papers of DIW Berlin 803, DIW Berlin, German Institute for Economic Research.

    More about this item

    Keywords

    Life satisfaction; expectations; aging;
    All these keywords.

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:cep:cepdps:dp1229. 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: the person in charge (email available below). General contact details of provider: https://cep.lse.ac.uk/_new/publications/discussion-papers/ .

    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.