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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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File URL: http://www.uni-trier.de/fileadmin/fb4/prof/VWL/EWF/Research_Papers/2014-10.pdf
File Function: First version, 2014
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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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Web page: http://www.uni-trier.de/index.php?id=2118

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  1. Sacks, Daniel W. & Stevenson, Betsey & Wolfers, Justin, 2010. "Subjective Well-Being, Income, Economic Development and Growth," IZA Discussion Papers 5230, Institute for the Study of Labor (IZA).
  2. repec:pri:cheawb:deaton_income_health_and_wellbeing_around_the_world_evidence_%20from_gall is not listed on IDEAS
  3. 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.
  4. Opfinger, Matthias & Gundlach, Erich, 2011. "Religiosity as a determinant of happiness," Proceedings of the German Development Economics Conference, Berlin 2011 63, Verein für Socialpolitik, Research Committee Development Economics.
  5. repec:pri:cheawb:deaton_income_health_and_wellbeing_around_the_world_evidence_%20from_gallup_world_poll_jep_spring2008 is not listed on IDEAS
  6. Robert J. MacCulloch & Rafael Di Tella & Andrew J. Oswald, 2001. "Preferences over Inflation and Unemployment: Evidence from Surveys of Happiness," American Economic Review, American Economic Association, vol. 91(1), pages 335-341, March.
  7. 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.
  8. Abbott Ferriss, 2002. "Religion and the Quality of Life," Journal of Happiness Studies, Springer, vol. 3(3), pages 199-215, September.
  9. Timothy Hinks, 2012. "Fractionalization and Well-Being: Evidence from a new South African data set," Working Papers 20121202, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
  10. repec:taf:regstd:v:46:y:2012:i:3:p:253-271 is not listed on IDEAS
  11. Easterly, William & Levine, Ross, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1203-50, November.
  12. McCleary, Rachel & Barro, Robert, 2002. "Religion and Political Economy in an International Panel," Scholarly Articles 3221170, Harvard University Department of Economics.
  13. Montalvo, Jose G. & Reynal-Querol, Marta, 2005. "Ethnic diversity and economic development," Journal of Development Economics, Elsevier, vol. 76(2), pages 293-323, April.
  14. 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.
  15. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  16. Matthias Opfinger, 2014. "Two Sides of a Medal: the Changing Relationship between Religious Diversity and Religiosity," Review of Social Economy, Taylor & Francis Journals, vol. 72(4), pages 523-548, October.
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