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The Sad Truth About Happiness Scales

  • Timothy N. Bond
  • Kevin Lang

We show that, without strong auxiliary assumptions, it is impossible to rank groups by average happiness using survey data with a few potential responses. The categories represent intervals along some continuous distribution. The implied CDFs of these distributions will (almost) always cross when estimated using large samples. Therefore some monotonic transformation of the utility function will reverse the ranking. We provide several examples and a formal proof. Whether Moving-to-Opportunity increases happiness, men have become happier relative to women, and an Easterlin paradox exists depends on whether happiness is distributed normally or log-normally. We discuss restrictions that may permit such comparisons.

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File URL: http://www.nber.org/papers/w19950.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19950.

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Date of creation: Mar 2014
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Handle: RePEc:nbr:nberwo:19950
Note: DEV LS PE
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  1. Jens Ludwig & Greg J. Duncan & Lisa A. Gennetian & Lawrence F. Katz & Ronald C. Kessler & Jeffrey R. Kling & Lisa Sanbonmatsu, 2013. "Long-Term Neighborhood Effects on Low-Income Families: Evidence from Moving to Opportunity," American Economic Review, American Economic Association, vol. 103(3), pages 226-31, May.
  2. Timothy N. Bond & Kevin Lang, 2013. "The Evolution of the Black-White Test Score Gap in Grades K–3: The Fragility of Results," The Review of Economics and Statistics, MIT Press, vol. 95(5), pages 1468-1479, December.
  3. Hammond, Peter J. & Liberini, Federica & Proto, Eugenio, 2011. "Individual Welfare and Subjective Well-Being : Commentary Inspired by Sacks, Stevenson and Wolfers," The Warwick Economics Research Paper Series (TWERPS) 957, University of Warwick, Department of Economics.
  4. Betsey Stevenson & Justin Wolfers, 2008. "Happiness Inequality in the United States," The Journal of Legal Studies, University of Chicago Press, vol. 37(S2), pages S33-S79, 06.
  5. Angus Deaton, 2008. "Income, Health, and Well-Being around the World: Evidence from the Gallup World Poll," Journal of Economic Perspectives, American Economic Association, vol. 22(2), pages 53-72, Spring.
  6. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2000. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," NBER Working Papers 7973, National Bureau of Economic Research, Inc.
  7. Betsey Stevenson & Justin Wolfers, 2009. "The paradox of declining female happiness," Working Paper Series 2009-11, Federal Reserve Bank of San Francisco.
  8. Andrew E. Clark & Sarah Flèche & Claudia Senik, 2014. "Economic Growth Evens-Out Happiness: Evidence from Six Surveys," PSE Working Papers halshs-00936145, HAL.
  9. Timothy N. Bond & Kevin Lang, 2013. "The Black-White Education-Scaled Test-Score Gap in Grades K-7," NBER Working Papers 19243, National Bureau of Economic Research, Inc.
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