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Ambition and Jealousy: Income Interactions in the "Old" Europe versus the "New" Europe and the United States

  • Senik, Claudia

    ()

    (Paris School of Economics)

This paper asks how income distribution affects individual well-being and tries to explore the idea that this relation depends on the degree of mobility and uncertainty in the economy. It mostly concentrates on the relation between satisfaction and reference income (defined as the income of one’s professional peers), and hinges on the micro-econometric analysis of household survey data (mostly panel), including subjective attitudinal questions. Using over one million observations, it uncovers a divide between "old" -low mobility- European countries versus "new" European post-Transition countries and the United States. Whereas "jealousy" is dominant in the former, "ambition" is even stronger in the latter.

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File URL: http://ftp.iza.org/dp2083.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2083.

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Length: 40 pages
Date of creation: Apr 2006
Date of revision:
Publication status: published in: Economica, 2008, 75 (299), 495-513
Handle: RePEc:iza:izadps:dp2083
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  1. Clark, Andrew E. & Oswald, Andrew J., 1994. "Satisfaction and comparison income," CEPREMAP Working Papers (Couverture Orange) 9408, CEPREMAP.
  2. Francesco Daveri & Olmo Silva, . "Not Only Nokia," Working Papers 222, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  3. Bruno S. Frey & Alois Stutzer, 2002. "What Can Economists Learn from Happiness Research?," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 402-435, June.
  4. Benabou, R. & Ok, E.A., 1998. "Social Mobility and the Demand for Redistribution: The POUM Hypothesis," Working Papers 98-23, C.V. Starr Center for Applied Economics, New York University.
  5. Charles F. Manski, 2000. "Economic Analysis of Social Interactions," NBER Working Papers 7580, National Bureau of Economic Research, Inc.
  6. Alesina, Alberto F & La Ferrara, Eliana, 2002. "Preferences for Redistribution in the Land of Opportunities," CEPR Discussion Papers 3155, C.E.P.R. Discussion Papers.
  7. Thomas Piketty, 1994. "Social Mobility and Redistributive Politics," Working papers 94-15, Massachusetts Institute of Technology (MIT), Department of Economics.
  8. Hirschman, Albert O., 1973. "The changing tolerance for income inequality in the course of economic development," World Development, Elsevier, vol. 1(12), pages 29-36, December.
  9. Luttmer, Erzo F. P., 2004. "Neighbors as Negatives: Relative Earnings and Well-Being," Working Paper Series rwp04-029, Harvard University, John F. Kennedy School of Government.
  10. Ravallion, Martin & Lokshin, Michael, 2000. "Identifying welfare effects from subjective questions," Policy Research Working Paper Series 2301, The World Bank.
  11. Alberto Alesina & Edward Glaeser & Bruce Sacerdote, 2001. "Why Doesn't the US Have a European-Style Welfare System?," NBER Working Papers 8524, National Bureau of Economic Research, Inc.
  12. Caplin, Andrew & Leahy, John, 1997. "Psychological Expected Utility Theory and Anticipatory Feelings," Working Papers 97-37, C.V. Starr Center for Applied Economics, New York University.
  13. Frank, Robert H, 1997. "The Frame of Reference as a Public Good," Economic Journal, Royal Economic Society, vol. 107(445), pages 1832-47, November.
  14. Di Tella, Rafael & MacCulloch, Robert J. & Oswald, Andrew J., 2001. "The Macroeconomics of Happiness," The Warwick Economics Research Paper Series (TWERPS) 615, University of Warwick, Department of Economics.
  15. Harald Uhlig & Lars Ljungqvist, 2000. "Tax Policy and Aggregate Demand Management under Catching Up with the Joneses," American Economic Review, American Economic Association, vol. 90(3), pages 356-366, June.
  16. Cooper, B. & Garcia-Penalosa, C., 1998. "Status Effects and Neganive Utility Growth," Economics Papers 150, Economics Group, Nuffield College, University of Oxford.
  17. Senik, Claudia, 2005. "Ambition and jealousy. Income Interactions in the "old" Europe versus The "New" Europe and the United States," CEPREMAP Working Papers (Docweb) 0510, CEPREMAP.
  18. Alberto Alesina & George-Marios Angeletos, 2003. "Fairness and Redistribution: U.S. versus Europe," NBER Working Papers 9502, National Bureau of Economic Research, Inc.
  19. Atkinson, A. B. & Bourguignon, F. & Morrisson, C., 1988. "Earnings mobility," European Economic Review, Elsevier, vol. 32(2-3), pages 619-632, March.
  20. Hans Peter Gruner & Giacomo Corneo, 2000. "Social Limits to Redistribution," American Economic Review, American Economic Association, vol. 90(5), pages 1491-1507, December.
  21. Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, 07.
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