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Is Happiness Infectious?

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  • John Knight
  • Ramani Gunatilaka

Abstract

The paper uses an appropriate survey from rural China to answer the question: Is happiness infectious, i.e. does the happiness of an individual depend positively on the happiness of their reference group? The evidence is consistent with this hypothesis, but the challenge is to solve the 'reflection problem', i.e. is the apparent effect of neighbours' happiness on own happiness a causal one or merely a reflection? A 'quasi-panel' approach is adopted, treating villages as groups and individuals as multiple observations within each group, and using an error components 2SLS estimator. The results suggest that a major part of the relationship is indeed causal: Adam Smith's insight was correct! The normative and policy implications are briefly considered.

Suggested Citation

  • John Knight & Ramani Gunatilaka, 2009. "Is Happiness Infectious?," Economics Series Working Papers 446, University of Oxford, Department of Economics.
  • Handle: RePEc:oxf:wpaper:446
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    References listed on IDEAS

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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Infectious happiness
      by chris dillow in Stumbling and Mumbling on 2009-09-21 18:59:54

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    Cited by:

    1. Carlsson, Fredrik & Lampi, Elina & Li, Wanxin & Martinsson, Peter, 2011. "Subjective well-being among preadolescents - Evidence from urban China," Working Papers in Economics 500, University of Gothenburg, Department of Economics.
    2. John Knight & Ramani Gunatilaka, 2010. "The Rural-Urban Divide in China: Income but Not Happiness?," Journal of Development Studies, Taylor & Francis Journals, vol. 46(3), pages 506-534.
    3. repec:taf:rjapxx:v:16:y:2011:i:2:p:163-182 is not listed on IDEAS

    More about this item

    Keywords

    Happiness; Social interaction; Relative deprivation; China;

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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