Income, Happiness, and the Disutility of Labour
We reexamine the claim that the effect of income on subjective well-being suffers from a systematic downward bias if one ignores that higher income is typically associated with more work effort. We analyze this claim using German panel data, controlling for individual unobserved heterogeneity, and specifying the impact of working hours in a non-monotonic form. Our results suggest that the impact of working hours on happiness is rather small and exhibits an inverse U-shape. We do not find evidence that leaving working hours out of the analysis leads to an underestimation of the income effect.
|Date of creation:||Mar 2009|
|Date of revision:|
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- Andrew E. Clark & Paul Frijters & Michael A. Shields, 2008.
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- Booth, Alison L. & van Ours, Jan C., 2007.
"Job satisfaction and family happiness: the part-time work puzzle,"
ISER Working Paper Series
2007-20, Institute for Social and Economic Research.
- AlisonL. Booth & JanC. vanOurs, 2008. "Job Satisfaction and Family Happiness: The Part-Time Work Puzzle," Economic Journal, Royal Economic Society, vol. 118(526), pages F77-F99, 02.
- Alison L. Booth & Jan C. van Ours, 2007. "Job Satisfaction and Family Happiness: The Part-time Work Puzzle," Department of Economics - Working Papers Series 1000, The University of Melbourne.
- Booth, Alison L. & van Ours, Jan C., 2007. "Job Satisfaction and Family Happiness: The Part-time Work Puzzle," IZA Discussion Papers 3020, Institute for the Study of Labor (IZA).
- Booth, Alison L & van Ours, Jan C, 2007. "Job Satisfaction and Family Happiness: The Part-time Work Puzzle," CEPR Discussion Papers 6471, C.E.P.R. Discussion Papers.
- 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.
- Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, Oxford University Press, vol. 120(3), pages 963-1002.
- Erzo F.P. Luttmer, 2004. "Neighbors as Negatives: Relative Earnings and Well-Being," NBER Working Papers 10667, National Bureau of Economic Research, Inc.
- Ada Ferrer-i-Carbonell & Paul Frijters, 2002.
"How important is Methodology for the Estimates of the Determinants of Happiness?,"
Tinbergen Institute Discussion Papers
02-024/3, Tinbergen Institute.
- 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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