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What can happiness research tell us about altruism? Evidence from the German Socio-Economic Panel

  • Johannes Schwarze

    (University of Bamberg)

  • Rainer Winkelmann

    ()

    (Socioeconomic Institute, University of Zurich)

Much progress has been made in recent years on developing and applying a direct measure of utility using survey questions on subjective well-being. In this paper we explore whether this new type of measurement can be fruitfully applied to the study of interdependent utility in general, and altruism between parents and adult children who moved away from home in particular. We introduce an appropriate econometric methodology and, using data from the German SocioEconomic Panel for the years 2000-2004, find that the parents’ self-reported happiness depends positively on the happiness of their adult children. A one standard deviation move in the child’s happiness has the same effect as a 45 percent move in household income.

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File URL: http://www.soi.uzh.ch/research/wp/2005/wp0503.pdf
File Function: Revised version, 2005
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Paper provided by Socioeconomic Institute - University of Zurich in its series SOI - Working Papers with number 0503.

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Length: 26 pages
Date of creation: Feb 2005
Date of revision: Sep 2005
Handle: RePEc:soz:wpaper:0503
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  1. Rainer Winkelmann, 2002. "Subjective Well-Being and the Family: Results from an Ordered Probit Model with Multiple Random Effects," SOI - Working Papers 0204, Socioeconomic Institute - University of Zurich, revised Jan 2004.
  2. Lars P. Feld & Sarah Necker & Bruno S .Frey, 2014. "Happiness of economists," CREMA Working Paper Series 2014-16, Center for Research in Economics, Management and the Arts (CREMA).
  3. Altonji, Joseph G & Hayashi, Fumio & Kotlikoff, Laurence J, 1992. "Is the Extended Family Altruistically Linked? Direct Tests Using Micro Data," American Economic Review, American Economic Association, vol. 82(5), pages 1177-98, December.
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  6. Bruno S. Frey & Alois Stutzer, . "What can Economists Learn from Happiness Research?," IEW - Working Papers 080, Institute for Empirical Research in Economics - University of Zurich.
  7. Phelps, Charlotte D., 2001. "A clue to the paradox of happiness," Journal of Economic Behavior & Organization, Elsevier, vol. 45(3), pages 293-300, July.
  8. Stutzer, Alois & Frey, Bruno S., 2005. "Does Marriage Make People Happy, Or Do Happy People Get Married?," IZA Discussion Papers 1811, Institute for the Study of Labor (IZA).
  9. Peter Egger & Michael Pfaffermayr, 2002. "Long Run and Short Effects in Static Panel Models," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 B6-2, International Conferences on Panel Data.
  10. Paul Frijters & John P. Haisken-DeNew & Michael A. Shields, 2004. "Money Does Matter! Evidence from Increasing Real Income and Life Satisfaction in East Germany Following Reunification," American Economic Review, American Economic Association, vol. 94(3), pages 730-740, June.
  11. Mundlak, Yair, 1978. "On the Pooling of Time Series and Cross Section Data," Econometrica, Econometric Society, vol. 46(1), pages 69-85, January.
  12. Ernst Fehr & Urs Fischbacher, 2004. "The nature of human altruism," Experimental 0402003, EconWPA.
  13. Blanchflower, David G. & Oswald, Andrew J., 2004. "Well-being over time in Britain and the USA," Journal of Public Economics, Elsevier, vol. 88(7-8), pages 1359-1386, July.
  14. Becker, Gary S, 1981. "Altruism in the Family and Selfishness in the Market Place," Economica, London School of Economics and Political Science, vol. 48(189), pages 1-15, February.
  15. Christian Dustmann, 2004. "Parental background, secondary school track choice, and wages," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 209-230, April.
  16. Gary S. Becker, 1974. "A Theory of Social Interactions," NBER Working Papers 0042, National Bureau of Economic Research, Inc.
  17. Clark, Andrew E & Oswald, Andrew J, 1994. "Unhappiness and Unemployment," Economic Journal, Royal Economic Society, vol. 104(424), pages 648-59, May.
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