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Elusive effects of unemployment on happiness

Author Info

Listed author(s):
  • Petri Böckerman

    (Labour Institute for Economic Research)

  • Pekka Ilmakunnas

    (Helsinki School of Economics)

Abstract

This paper explores the connection between unemployment and subjective well-being in Finland by using cross-sections for the years 1990, 1996 and 2000 from World Values Surveys. An unprecedented increase in the national unemployment rate (from 3 to 17 per cent) did not produce a drop in the mean level of subjective well-being. Experiencing unemployment personally reduces life satisfaction, but does not have a significant effect on happiness in ordered logit estimation. However, generalized ordered logit estimation reveals that being unemployed has a negative effect on happiness at lower happiness scores, but no significant effect at high happiness levels.

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File URL: http://econwpa.repec.org/eps/lab/papers/0504/0504008.pdf
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Paper provided by EconWPA in its series Labor and Demography with number 0504008.

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Length: 16 pages
Date of creation: 19 Apr 2005
Handle: RePEc:wpa:wuwpla:0504008
Note: Type of Document - pdf; pages: 16
Contact details of provider: Web page: http://econwpa.repec.org

Keywords: happiness; unhappiness; life satisfaction; unemployment;

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Find related papers by JEL classification:
  • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
  • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
  • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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  1. Assar Lindbeck & Sten Nyberg & Jörgen W. Weibull, 1999. "Social Norms and Economic Incentives in the Welfare State," The Quarterly Journal of Economics, Oxford University Press, vol. 114(1), pages 1-35.
  2. 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.
  3. 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.
  4. Clark, Andrew E & Oswald, Andrew J, 1994. "Unhappiness and Unemployment," Economic Journal, Royal Economic Society, vol. 104(424), pages 648-659, May.
  5. Andrew E. Clark & Yannis Georgellis, 2002. "Unemployment Alters the Set-Point for Life Satisfaction," Economics and Finance Discussion Papers 02-16, Economics and Finance Section, School of Social Sciences, Brunel University.
  6. Winkelmann, Liliana & Winkelmann, Rainer, 1998. "Why Are the Unemployed So Unhappy? Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 65(257), pages 1-15, February.
  7. Easterlin, Richard A, 2001. "Income and Happiness: Towards an Unified Theory," Economic Journal, Royal Economic Society, vol. 111(473), pages 465-484, July.
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Cited by:

  1. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.
  2. Petri Böckerman & Pekka Ilmakunnas, 2009. "Unemployment and self-assessed health: evidence from panel data," Health Economics, John Wiley & Sons, Ltd., vol. 18(2), pages 161-179.
  3. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.
  4. Ballester, Ramon & Recio, Albert & Garriga, Anna, 2015. "Programas de garantía de rentas e inserción laboral: El itinerario de inserción laboral de Cáritas Girona/Minimum Income Schemes and Labour Insertion: The Occupational Itinerary of Caritas Girona," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 33, pages 1011-1036, Septiembr.
  5. Néstor Gandelman & Giorgina Piani, 2013. "Quality of Life Satisfaction among Workers and Non-Workers in Uruguay," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 111(1), pages 97-115, March.
  6. Krause, Annabelle, 2013. "Don’t worry, be happy? Happiness and reemployment," Journal of Economic Behavior & Organization, Elsevier, vol. 96(C), pages 1-20.

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