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Ambition and jealousy. Income interactions in the "Old" Europe versus the "New" Europe and the United States

  • Claudia Senik

    (UP4 - Université Paris-Sorbonne, PSE - Paris-Jourdan Sciences Economiques - CNRS - EHESS - École des hautes études en sciences sociales - ENS Paris - École normale supérieure - Paris - École des Ponts ParisTech (ENPC))

Using individual-level data from a large number of countries, this paper examines how self-reported subjective well-being depends on own income and reference income, where reference income is defined as the income of professional peers. It uncovers a divide between "old" -low mobility- European countries versus "new" European post-Transition countries and the United States. Whereas in the old Europe, the income of my reference group exerts a negative effect on my individual welfare, it has a positive impact in the new Europe and the United States. This finding is interpreted as reflecting the relative importance of comparisons ("jealousy") versus information ("ambition"), which in turn depends on the degree of mobility and uncertainty in the economy.

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Paper provided by HAL in its series PSE Working Papers with number halshs-00590828.

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Date of creation: Mar 2007
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Handle: RePEc:hal:psewpa:halshs-00590828
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