A simple statistical method for measuring how life events affect happiness

Background Life events—like illness, marriage, or unemployment—have important effects on people. But there is no accepted way to measure the different sizes of these events upon human happiness and psychological health. By using happiness regression equations, economists have recently developed a method. Methods We estimate happiness regressions using large random samples of individuals. The relative coefficients of income and life events on happiness allow us to calculate a monetary ‘compensating amount’ for each kind of life event. Results The paper calculates the impact of different life events upon human well-being. Getting married, for instance, is calculated to bring each year the same amount of happiness, on average, as having an extra £70 000 of income per annum. The psychological costs of losing a job greatly exceed those from the pure drop in income. Health is hugely important to happiness. Widowhood brings a degree of unhappiness that would take, on average, an extra £170 000 per annum to offset. Well-being regressions also allow us to assess one of the oldest conjectures in social science—that well-being depends not just on absolute things but inherently on comparisons with other people. We find evidence for comparison effects. Conclusion We believe that the new statistical method has many applications. In principle, it can be used to value any kind of event in life

The organisational commitment of workers in OECD countries

The degree to which workers identify with their firms, and how hard they are willing to work for them, would seem to be key variables for the understanding of both firm productivity and individual labour-market outcomes. This paper uses repeated cross-section ISSP data from 1997 and 2005 to consider three of measures of worker commitment. There are enormous cross-country differences in these commitment measures, which are difficult to explain using individual- or job-related characteristics. These patterns do, however, correlate with some country-level variables. While unemployment and inflation are both associated with lower commitment to an extent, economic and civil liberties are positively correlated with worker effort and pride in the firm.commitment ; reciprocity ; well-being

Born to be mild? Cohort effects don't explain why well-being is U-shaped in age

The statistical analysis of cross-section data very often reveals a U-shaped relationship between subjective well-being and age. This paper uses fourteen waves of British panel data to distinguish between a pure life-cycle or aging effect, and a fixed cohort effect that depends on year of birth. Panel analysis controlling for fixed effects continues to produce a U-shaped relationship between well-being and age, although this U-shape is flatter for life satisfaction than for the GHQ measure of mental well-being. The pattern of the estimated cohort effects differs between the two well-being measures and, to an extent, by demographic group. In particular, those born earlier report more positive GHQ scores, controlling for their current age; this phenomenon is especially found for women.well-being ; aging ; cohort effects ; panel analysis

Work, jobs and well-being across the Millennium

This paper uses repeated cross-section data ISSP data from 1989, 1997 and 2005 to consider movements in job quality. It is first underlined that not having a job when you want one is a major source of low well-being. Second, job values have remained fairly stable over time, although workers seem to give increasing importance to the more social aspects of jobs: useful and helpful jobs. The central finding of the paper is that, following a substantial fall between 1989 and 1997, subjective measures of job quality have mostly bounced back between 1997 and 2005. Overall job satisfaction is higher in 2005 than it was in 1989. Last, the rate of self-employment has been falling gently in ISSP data; even so three to four times as many people say they would prefer to be self-employed than are actually self-employed. As the self-employed are more satisfied than are employees, one consistent interpretation of the above is that the barriers to self-employment have grown in recent years.employment ; unemployment ; self-employment ; life satisfaction ; job quality ; job satisfaction

Happiness, habits and high rank: Comparisons in economic and social life

The role of money in producing sustained subjective well-being seems to be seriously compromised by social comparisons and habituation. But does that necessarily mean that we would be better off doing something else instead? This paper suggests that the phenomena of comparison and habituation are actually found in a variety of economic and social activities, rendering conclusions regarding well-being policy less straightforward.comparison ; habituation ; income ; unemployment ; marriage ; divorce ; health ; religion ; policy

A note on unhappiness and unemployment duration

Although it is now widely-accepted that unemployment is associated with sharply lower levels of individual well-being, relatively little is known about how this effect depends on unemployment duration. Data from three large-scale European panels is used to shed light on this issue; these data allow us to distinguish habituation to unemployment from sample selection. The panel results show little evidence of habituation to unemployment in Europe in the 1990's.life satisfaction ; unemployment ; unemployment duration ; habituation

The curved relationship between subjective well-being and age

This article is concerned with a body of work on happiness and age represented by important papers such as Mroczek and Kolarz (1998) and Mroczek and Spiro (2005). Using a large British data set, the paper presents new longitudinal evidence. It also points out that, perhaps unknown to many psychologists, a parallel literature on this topic exists in economics journals. The paper shows that subjective well-being follows a U-shape through the life course. We argue that eventually the two literatures will have to be made consistent with one another, and suggest that, although it is not easy to live in both worlds, with their different styles and conventions, economists and psychologists still have much to learn from one another.happiness ; ageing ; well-being

Do people really adapt to marriage?

Although cross-sectional studies have shown a reliable association between marital status and subjective well-being, a recent longitudinal study (Lucas, Clark, Georgellis, & Diener, 2003) found no support for the idea that happiness increases after marriage. Instead, participants who got married reported short-term increases followed by complete adaptation back to baseline levels of well-being. However, researchers have criticized this study on two grounds. First, these results contradict cohort-based analyses from a nationally representative sample. Second, these analyses do not control for pre-marriage cohabitation, which could potentially inflate baseline levels of well-being. The original data (plus four additional waves) are reanalyzed to address these concerns. Results confirm that individuals do not get a lasting boost in life satisfaction following marriage.life satisfaction anticipation ; habituation ; marriage ; cohabitation

Will GDP growth increase happiness in developing countries?

This paper asks what low-income countries can expect from growth in terms of happiness. It interprets the set of available international evidence pertaining to the relationship between income growth and subjective well-being. Conforming to the Easterlin paradox, higher income always correlates with higher happiness, except in one case: whether national income growth yields higher well-being is still hotly debated; essentially, the question is whether the correlation coefficient is "too small to matter". The explanations for the small correlation between income growth and subjective well-being over time appeal to the nature of growth itself (e.g. negative side-effects such as pollution), and to the psychological importance of relative concerns and adaptation. The available evidence contains two important lessons: income comparisons do seem to affect subjective well-being even in very poor countries; however, adaptation may be more of a rich country phenomenon. Our stand is that the idea that growth will increase happiness in low-income countries cannot be rejected on the basis of the available evidence. First, cross-country time-series analyses are based on aggregate measures, which are less reliable than individual ones. Second, development is a qualitative process that involves take-offs and thresholds. Such regime changes are eye-visible through the lens of subjective satisfaction measures. The case of Transition countries is particularly impressive in this respect: average life satisfaction scores closely mirror changes in GDP for about the first ten years of the transition process, until the regime becomes more stable. If subjective measures of well-being were made available in low-income countries, they would certainly help measuring and monitoring the different stages and dimensions of the development process.income ; subjective well-being ; comparisons ; adaptation ; development

Let us pray: religious interactions in life satisfaction

We use recent pooled survey data on 90 000 individuals in 26 European countries to examine religious spillover effects on life satisfaction. Own religious behaviour is positively correlated with individual life satisfaction. More unusually, average religiosity in the region also has a positive impact: people are more satisfied in more religious regions. This spillover holds both for those who are religious and for those who are not. The flipside of the coin is that a greater proportion of "atheists" (those who say they do not currently belong to any religious denomination) has negative spillover effects, for the religious and atheists alike. We last show that both Protestants and Catholics like to live in regions where their own religion is dominant, while Protestants are also more satisfied when Catholics dominate. The generic positive spillover effect of others' religion is not explained by social capital, crime, or trust.life satisfaction ; religion ; externalities