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Economic growth evens-out happiness: evidence from six surveys

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  • Clark, Andrew E.
  • Flèche, Sarah
  • Senik, Claudia

Abstract

In spite of the great U-turn that saw income inequality rise in Western countries in the 1980s, happiness inequality has fallen in countries that have experienced income growth (but not in those that did not). Modern growth has reduced the share of both the “very unhappy” and the “perfectly happy”. Lower happiness inequality is found both between and within countries, and between and within individuals. Our cross-country regression results argue that the extension of various public goods helps to explain this greater happiness homogeneity. This new stylised fact arguably comes as a bonus to the Easterlin paradox, offering a somewhat brighter perspective for developing countries.

Suggested Citation

  • Clark, Andrew E. & Flèche, Sarah & Senik, Claudia, 2014. "Economic growth evens-out happiness: evidence from six surveys," LSE Research Online Documents on Economics 60530, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:60530
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    More about this item

    Keywords

    Happiness; inequality; economic growth; development; Easterlin paradox;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D6 - Microeconomics - - Welfare Economics
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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