IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Life Satisfaction in Urban Ethiopia: Trends and determinants

  • Alem, Yonas

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Köhlin, Gunnar

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Most studies of subjective well-being in developing countries use cross-sectional data, which makes it difficult to control for unobserved individual heterogeneity. In this paper, we use three rounds of panel data and robust non-linear panel data models to investigate the trends and determinants of life satisfaction in urban Ethiopia. Although Ethiopia exhibited rapid economic growth during the analyzed period, the average reported level of life satisfaction declined. Regression results show that despite the significant difference between urban Ethiopia and industrialized countries in terms of economic and social conditions, many of the determinants of life satisfaction are similar. This includes, age, marital status, health, unemployment, economic status, relative position and educational achievement. Our results also indicate that both individual (respondent) and household level versions of these variables are important determinants of life satisfaction. This provides some evidence on the interdependence of individual and household subjective well-being in developing countries. The fact that rapid economic growth was accompanied by a decline in citizens’ average reported level of life satisfaction brings the pro-poorness of the recent economic growth in Ethiopia into question. We argue that economic growth that trickles down to the poor and ensures creation of stable jobs would be welfare enhancing.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hdl.handle.net/2077/31779
Download Restriction: no

Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 548.

as
in new window

Length: 31 pages
Date of creation: 19 Dec 2012
Date of revision:
Handle: RePEc:hhs:gunwpe:0548
Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Carol Graham & Stefano Pettinato, 2001. "Happiness, Markets, and Democracy: Latin America in Comparative Perspective," Journal of Happiness Studies, Springer, vol. 2(3), pages 237-268, September.
  2. Simon Davies & Tim Hinks, 2010. "Crime and Happiness Amongst Heads of Households in Malawi," Journal of Happiness Studies, Springer, vol. 11(4), pages 457-476, August.
  3. Hayo, Bernd & Seifert, Wolfgang, 2003. "Subjective economic well-being in Eastern Europe," Journal of Economic Psychology, Elsevier, vol. 24(3), pages 329-348, June.
  4. Alesina, Alberto & Di Tella, Rafael & MacCulloch, Robert, 2004. "Inequality and happiness: are Europeans and Americans different?," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 2009-2042, August.
  5. Caporale, Guglielmo Maria & Georgellis, Yannis & Tsitsianis, Nicholas & Yin, Ya Ping, 2009. "Income and happiness across Europe: Do reference values matter?," Journal of Economic Psychology, Elsevier, vol. 30(1), pages 42-51, February.
  6. Easterlin, Richard A., 1995. "Will raising the incomes of all increase the happiness of all?," Journal of Economic Behavior & Organization, Elsevier, vol. 27(1), pages 35-47, June.
  7. Geeta Gandhi Kingdon & John Knight, 2006. "Subjective well-being poverty vs. Income poverty and capabilities poverty?," Journal of Development Studies, Taylor & Francis Journals, vol. 42(7), pages 1199-1224.
  8. repec:ebl:ecbull:v:4:y:2008:i:24:p:1-10 is not listed on IDEAS
  9. Katrin Rehdanz & David J. Maddison, 2003. "Climate and Happiness," Working Papers FNU-20, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003.
  10. Appleton, Simon & Song, Lina, 2008. "Life Satisfaction in Urban China: Components and Determinants," World Development, Elsevier, vol. 36(11), pages 2325-2340, November.
  11. Alem, Yonas & Söderbom, Måns, 2012. "Household-Level Consumption in Urban Ethiopia: The Effects of a Large Food Price Shock," World Development, Elsevier, vol. 40(1), pages 146-162.
  12. Geeta Kingdon & John Knight, 2004. "Community, Comparisons and Subjective Well-being in a Divided Society," Development and Comp Systems 0409067, EconWPA.
  13. Alem, Yonas, 2013. "Poverty Persistence and Intra-Household Heterogeneity in Occupations: Evidence from Urban Ethiopia," Working Papers in Economics 580, University of Gothenburg, Department of Economics.
  14. Randy Larsen & Ed Diener & Robert Emmons, 1985. "An evaluation of subjective well-being measures," Social Indicators Research, Springer, vol. 17(1), pages 1-17, July.
  15. Heinz Welsch & Jan Kühling, 2009. "Using Happiness Data For Environmental Valuation: Issues And Applications," Journal of Economic Surveys, Wiley Blackwell, vol. 23(2), pages 385-406, 04.
  16. Russell Smyth & Xiaolei Qian, 2008. "Inequality and Happiness in Urban China," Economics Bulletin, AccessEcon, vol. 4(24), pages 1-10.
  17. McBride, Michael, 2001. "Relative-income effects on subjective well-being in the cross-section," Journal of Economic Behavior & Organization, Elsevier, vol. 45(3), pages 251-278, July.
  18. David G. Blanchflower & Andrew J. Oswald, 2004. "Money, Sex, and Happiness: An Empirical Study," NBER Working Papers 10499, National Bureau of Economic Research, Inc.
  19. KNIGHT, John & SONG, Lina & GUNATILAKA, Ramani, 2009. "Subjective well-being and its determinants in rural China," China Economic Review, Elsevier, vol. 20(4), pages 635-649, December.
  20. Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, MIT Press, vol. 120(3), pages 963-1002, August.
  21. Bookwalter, Jeffrey T. & Dalenberg, Douglas R., 2010. "Relative to What or Whom? The Importance of Norms and Relative Standing to Well-Being in South Africa," World Development, Elsevier, vol. 38(3), pages 345-355, March.
  22. Ferrer-i-Carbonell, Ada, 2005. "Income and well-being: an empirical analysis of the comparison income effect," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 997-1019, June.
  23. Clark, Andrew E. & Frijters, Paul & Shields, Michael A., 2007. "Relative Income, Happiness and Utility: An Explanation for the Easterlin Paradox and Other Puzzles," IZA Discussion Papers 2840, Institute for the Study of Labor (IZA).
  24. Guillaume R. Frechette, 2001. "Random-effects ordered probit," Stata Technical Bulletin, StataCorp LP, vol. 10(59).
  25. Glewwe, Paul & Hall, Gillette, 1998. "Are some groups more vulnerable to macroeconomic shocks than others? Hypothesis tests based on panel data from Peru," Journal of Development Economics, Elsevier, vol. 56(1), pages 181-206, June.
  26. Guillaume R. Frechette, 2001. "Update to random-effects ordered probit," Stata Technical Bulletin, StataCorp LP, vol. 10(61).
  27. Butler, J S & Moffitt, Robert, 1982. "A Computationally Efficient Quadrature Procedure for the One-Factor Multinomial Probit Model," Econometrica, Econometric Society, vol. 50(3), pages 761-64, May.
  28. Litchfield, Julie & Reilly, Barry & Veneziani, Mario, 2012. "An analysis of life satisfaction in Albania: An heteroscedastic ordered probit model approach," Journal of Economic Behavior & Organization, Elsevier, vol. 81(3), pages 731-741.
  29. Deon Filmer & Lant Pritchett, 2001. "Estimating Wealth Effects Without Expenditure Data—Or Tears: An Application To Educational Enrollments In States Of India," Demography, Springer, vol. 38(1), pages 115-132, February.
  30. Dolan, Paul & Peasgood, Tessa & White, Mathew, 2008. "Do we really know what makes us happy A review of the economic literature on the factors associated with subjective well-being," Journal of Economic Psychology, Elsevier, vol. 29(1), pages 94-122, February.
  31. Susana Ferreira & Mirko Moro, 2010. "On the Use of Subjective Well-Being Data for Environmental Valuation," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 46(3), pages 249-273, July.
  32. 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.
  33. Ravallion, Martin & Lokshin, Michael, 2002. "Self-rated economic welfare in Russia," European Economic Review, Elsevier, vol. 46(8), pages 1453-1473, September.
  34. Ferrer-i-Carbonell, Ada & Gowdy, John M., 2007. "Environmental degradation and happiness," Ecological Economics, Elsevier, vol. 60(3), pages 509-516, January.
  35. George MacKerron, 2012. "Happiness Economics From 35 000 Feet," Journal of Economic Surveys, Wiley Blackwell, vol. 26(4), pages 705-735, 09.
  36. Welsch, Heinz, 2006. "Environment and happiness: Valuation of air pollution using life satisfaction data," Ecological Economics, Elsevier, vol. 58(4), pages 801-813, July.
  37. Jeffrey Bookwalter & Douglas Dalenberg, 2004. "Subjective Well-Being and Household Factors in South Africa," Social Indicators Research, Springer, vol. 65(3), pages 333-353, February.
  38. Welsch, Heinz, 2002. "Preferences over Prosperity and Pollution: Environmental Valuation Based on Happiness Surveys," Kyklos, Wiley Blackwell, vol. 55(4), pages 473-94.
  39. Simon Luechinger, 2009. "Valuing Air Quality Using the Life Satisfaction Approach," Economic Journal, Royal Economic Society, vol. 119(536), pages 482-515, 03.
  40. C. Graham & S. Pettinato, 2002. "Frustrated Achievers: Winners, Losers and Subjective Well-Being in New Market Economies," Journal of Development Studies, Taylor & Francis Journals, vol. 38(4), pages 100-140.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:hhs:gunwpe:0548. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marie Andersson)

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.