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Life Goals Matter to Happiness: A Revision of Set-Point Theory

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  • Bruce Headey

Abstract

Using data from the long-running German Socio-Economic Panel Survey (SOEP), this paper provides evidence that life goals matter substantially to subjective well-being (SWB). Nonzero sum goals, which include commitment to family, friends and social and political involvement, promote life satisfaction. Zero sum goals, including commitment to career success and material gains, appear detrimental to life satisfaction. Finding that conscious life goals matter can potentially make an important contribution to SWB theory. The most widely accepted theory - set-point or dynamic equilibrium theory - essentially claims that set-points are near-automatic consequences of hereditary characteristics, including personality traits. Life goals play no role in these theories and major life events are viewed as having only a transitory effect. The SOEP panel data show that, over a 15-20 year period, non-trivial minorities record substantial changes in their set-points. This paper shows linkages between these changes and (a) the personality traits of extraversion, neuroticism and internal locus of control and (b) choice of life goals.

Suggested Citation

  • Bruce Headey, 2006. "Life Goals Matter to Happiness: A Revision of Set-Point Theory," Discussion Papers of DIW Berlin 639, DIW Berlin, German Institute for Economic Research.
  • Handle: RePEc:diw:diwwpp:dp639
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    File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.44816.de/dp639.pdf
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    References listed on IDEAS

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    1. Frank, Robert H, 1985. "The Demand for Unobservable and Other Nonpositional Goods," American Economic Review, American Economic Association, vol. 75(1), pages 101-116, March.
    2. Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde & Juergen Schupp & Gert Wagner, 2005. "Individual Risk Attitudes: New Evidence from a Large, Representative, Experimentally-Validated Survey," Working Papers 2096, The Field Experiments Website.
    3. Ng, Yew-Kwang, 1978. "Economic Growth and Social Welfare: The Need for a Complete Study of Happiness," Kyklos, Wiley Blackwell, vol. 31(4), pages 575-587.
    4. Hollander, Heinz, 2001. "On the validity of utility statements: standard theory versus Duesenberry's," Journal of Economic Behavior & Organization, Elsevier, vol. 45(3), pages 227-249, July.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Does a positive-sum attitude promote happiness?
      by Winton Bates in Freedom and Flourishing on 2008-08-12 15:31:00

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    Cited by:

    1. Bruce Headey, 2007. "The Set-Point Theory of Well-Being Needs Replacing: On the Brink of a Scientific Revolution?," SOEPpapers on Multidisciplinary Panel Data Research 55, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. N. Rickard & D. Vella-Brodrick, 2014. "Changes in Well-Being: Complementing a Psychosocial Approach with Neurobiological Insights," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 117(2), pages 437-457, June.

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