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Minding the Happiness Gap: Political Institutions and Perceived Quality of Life in Transition

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  • Nikolova, Milena

    (University of Groningen)

Abstract

Along with political and economic changes, the fall of the socialist regimes in Central and Eastern Europe and the former Soviet Union brought about fundamental institutional reforms. Several studies have examined the causes of the increasing unhappiness which accompanied the transition process, including deteriorating public goods, rising inequality, income volatility, stagnating labor market conditions, and changing norms. Yet, few papers have sought explanations for the life satisfaction differentials between transition and non-transition economies. In this paper, I specifically examine the life satisfaction gap between post-socialist and advanced countries and the role of political institutions in explaining this gap. My results imply that both macroeconomic factors and the rule of law explain the overall life satisfaction differential between the advanced and transition societies. The rule of law had an additional role of reducing the happiness gap in the 1990s and may have even reversed it in the post-crisis years. As institutions and macroeconomic conditions continue to improve, post-socialist countries may complete their transformation processes and achieve quality of life levels comparable with those in the West.

Suggested Citation

  • Nikolova, Milena, 2015. "Minding the Happiness Gap: Political Institutions and Perceived Quality of Life in Transition," IZA Discussion Papers 9484, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp9484
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    2. Nikolova Milena & Popova Olga, 2021. "Sometimes Your Best Just Ain’t Good Enough: The Worldwide Evidence on Subjective Well-being Efficiency," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(1), pages 83-114, January.
    3. Djankov, Simeon & Nikolova, Elena, 2018. "Communism as the unhappy coming," Journal of Comparative Economics, Elsevier, vol. 46(3), pages 708-721.
    4. Coupe, Tom & Obrizan, Maksym, 2018. "Adolescents’ (un)happiness in transition," Journal of Comparative Economics, Elsevier, vol. 46(3), pages 858-873.
    5. Anna Lewczuk, 2021. "Are civil liberties contagious? Analysis of determinants of de facto civil rights protection in post-socialist countries," Constitutional Political Economy, Springer, vol. 32(2), pages 187-217, June.
    6. Adsera, Alicia & Dalla Pozza, Francesca & Guriev, Sergei & Kleine-Rueschkamp, Lukas & Nikolova, Elena, 2019. "Transition from Plan to Market, Height and Well-Being," IZA Discussion Papers 12658, Institute of Labor Economics (IZA).
    7. Danuta Milaszewicz & Kesra Nermend, 2020. "Application of Vector Measure Construction Methods to Estimate Quality of Institutions: Nations in Transition," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 2), pages 16-29.
    8. Ekaterina Skoglund, 2017. "The happiness gap between transition and non-transition countries," IZA World of Labor, Institute of Labor Economics (IZA), pages 357-357, May.
    9. Guriev, Sergei & Melnikov, Nikita, 2018. "Happiness convergence in transition countries," Journal of Comparative Economics, Elsevier, vol. 46(3), pages 683-707.
    10. Christoph Glatz & Anja Eder, 2020. "Patterns of Trust and Subjective Well-Being Across Europe: New Insights from Repeated Cross-Sectional Analyses Based on the European Social Survey 2002–2016," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 148(2), pages 417-439, April.
    11. Carvalho, António, 2017. "Drivers of reported electricity service satisfaction in transition economies," Energy Policy, Elsevier, vol. 107(C), pages 151-157.
    12. Otrachshenko, Vladimir & Nikolova, Milena & Popova, Olga, 2021. "Double-edged sword: Persistent effects of Communism on life satisfaction," GLO Discussion Paper Series 927, Global Labor Organization (GLO).
    13. Xiwen Fu, 2018. "The Contextual Effects of Political Trust on Happiness: Evidence from China," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 139(2), pages 491-516, September.
    14. Anna Lewczuk, 2021. "On the Relationship Between Civil Liberties and Socio-Economic Development in Post-Socialist States," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 2, pages 5-29.
    15. Sergei Guriev & Nikita Melnikov, 2018. "Happiness Convergence in Transition Countries," Post-Print hal-03391926, HAL.
    16. Lewczuk Anna, 2018. "Empowerment Rights and Happiness Gap in Post-socialist Countries," Central European Economic Journal, Sciendo, vol. 5(52), pages 270-295, January.

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    More about this item

    Keywords

    transition economies; institutions; subjective well-being;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General

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