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Lags and leads in life satisfaction: a test of the baseline hypothesis

  • Andrew E. Clark
  • Ed Diener
  • Yannis Georgellis
  • Richard E. Lucas

We look for evidence of habituation in twenty waves of German panel data: do individuals, after life and labour market events, tend to return to some baseline level of well-being? Although the strongest life satisfaction effect is often at the time of the event, we find significant lag and lead effects. We cannot reject the hypothesis of complete adaptation to marriage, divorce, widowhood, birth of child, and layoff. However, there is little evidence of adaptation to unemployment. Men are somewhat more affected by labour market events (unemployment and layoffs) than are women, but in general the patterns of anticipation and adaptation are remarkably similar by sex.

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File URL: http://eprints.lse.ac.uk/19656/
File Function: Open access version.
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Paper provided by London School of Economics and Political Science, LSE Library in its series LSE Research Online Documents on Economics with number 19656.

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Length: 28 pages
Date of creation: Nov 2007
Date of revision:
Handle: RePEc:ehl:lserod:19656
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Web page: http://www.lse.ac.uk/

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  14. Ada Ferrer-i-Carbonell & Paul Frijters, 2002. "How important is Methodology for the Estimates of the Determinants of Happiness?," Tinbergen Institute Discussion Papers 02-024/3, Tinbergen Institute.
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  19. Winkelmann, Liliana & Winkelmann, Rainer, 1998. "Why Are the Unemployed So Unhappy? Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 65(257), pages 1-15, February.
  20. Andrew E. Clark, 2006. "A note on unhappiness and unemployment duration," PSE Working Papers halshs-00590444, HAL.
  21. Agerbo, E. & Eriksson, T. & Mortensen, P.B. & Westergard-Nielsen, N., 1998. "Unemployment and Mental Disorder - An Empirical Analysis," Papers 98-02, Centre for Labour Market and Social Research, Danmark-.
  22. Gerlach, Knut & Stephan, Gesine, 1996. "A paper on unhappiness and unemployment in Germany," Economics Letters, Elsevier, vol. 52(3), pages 325-330, September.
  23. Andrew Clark & Yannis Georgellis & Peter Sanfey, 1997. "Job Satisfaction, Wage Changes and Quits: Evidence from Germany," Studies in Economics 9711, School of Economics, University of Kent.
  24. Goldsmith, Arthur H. & Veum, Jonathan R. & William Darity, Jr., 1996. "The impact of labor force history on self-esteem and its component parts, anxiety, alienation and depression," Journal of Economic Psychology, Elsevier, vol. 17(2), pages 183-220, April.
  25. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP): Scope, Evolution and Enhancements," SOEPpapers on Multidisciplinary Panel Data Research 1, DIW Berlin, The German Socio-Economic Panel (SOEP).
  26. Anke C. Zimmermann & Richard A. Easterlin, 2006. "Happily Ever After? Cohabitation, Marriage, Divorce, and Happiness in Germany," Population and Development Review, The Population Council, Inc., vol. 32(3), pages 511-528.
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  28. Jonathan Gardner & Andrew J. Oswald, 2006. "Do divorcing couples become happier by breaking up?," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 169(2), pages 319-336.
  29. Richard Lucas & Andrew Clark, 2006. "Do People Really Adapt To Marriage?," Journal of Happiness Studies, Springer, vol. 7(4), pages 405-426, November.
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  33. Yashiv, Eran, 2006. "U.S. Labor Market Dynamics Revisited," IZA Discussion Papers 2455, Institute for the Study of Labor (IZA).
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