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‘United in Diversity’---Does Social Diversity Increase Subjective?

  • Matthias Opfinger

The European Union emphasizes the advantages arising from diversity. However, economic studies prove that diversity can lead to detrimental outcomes, ultimately resulting in lower well-being. This paper assesses the direct link between well-being and diversity within a society, in terms of ethnicity, language, and religion. I find that ethnic diversity is linearly and positively related to happiness and life satisfaction. The other dimensions of social diversity and well-being are related in a U-shape. At low levels of diversity an increase reduces well-being. The relationship becomes positive only if diversity is sufficiently high. I argue that a threat to the dominant position of one group prevents the formation of a common identity. If diversity is sufficiently high, the groups have to establish contact which reduces prejudices and helps to form a common identity.

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Paper provided by University of Trier, Department of Economics in its series Research Papers in Economics with number 2014-10.

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Length: 20 pages
Date of creation: 2014
Date of revision:
Handle: RePEc:trr:wpaper:201410
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  1. Daniel W. Sacks & Betsey Stevenson & Justin Wolfers, 2010. "Subjective well-being, income, economic development and growth," Working Paper Series 2010-28, Federal Reserve Bank of San Francisco.
  2. repec:taf:regstd:v:46:y:2012:i:3:p:253-271 is not listed on IDEAS
  3. Opfinger, Matthias & Gundlach, Erich, 2011. "Religiosity as a determinant of happiness," Open Access Publications from Kiel Institute for the World Economy 48360, Kiel Institute for the World Economy (IfW).
  4. Timothy Hinks, 2012. "Fractionalization and well-being: Evidence from a new South African data set," New Zealand Economic Papers, Taylor & Francis Journals, vol. 46(3), pages 253-271, December.
  5. Montalvo, Jose G. & Reynal-Querol, Marta, 2005. "Ethnic diversity and economic development," Journal of Development Economics, Elsevier, vol. 76(2), pages 293-323, April.
  6. Mookerjee, Rajen & Beron, Krista, 2005. "Gender, religion and happiness," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 34(5), pages 674-685, October.
  7. McCleary, Rachel & Barro, Robert, 2002. "Religion and Political Economy in an International Panel," Scholarly Articles 3221170, Harvard University Department of Economics.
  8. repec:pri:cheawb:deaton_income_health_and_wellbeing_around_the_world_evidence_%20from_gall is not listed on IDEAS
  9. repec:pri:cheawb:deaton_income_health_and_wellbeing_around_the_world_evidence_%20from_gallup_world_poll_jep_spring2008 is not listed on IDEAS
  10. Easterlin, Richard A., 1995. "Will raising the incomes of all increase the happiness of all?," Journal of Economic Behavior & Organization, Elsevier, vol. 27(1), pages 35-47, June.
  11. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  12. Matthias Opfinger, 2013. "Two Sides of a Medal: The Changing Relationship between Religious Diversity and Religiosity," Research Papers in Economics 2013-06, University of Trier, Department of Economics.
  13. Abbott Ferriss, 2002. "Religion and the Quality of Life," Journal of Happiness Studies, Springer, vol. 3(3), pages 199-215, September.
  14. DiTella, Rafael & MacCulloch, Robert & Oswald, Andrew J., 2001. "Preferences over inflation and unemployment: Evidence from surveys of happiness," ZEI Working Papers B 03-2001, ZEI - Center for European Integration Studies, University of Bonn.
  15. Easterly, W & Levine, R, 1996. "Africa's Growth Tragedy : Policies and Ethnic Divisions," Papers 536, Harvard - Institute for International Development.
  16. 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.
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