Happiness and the Persistence of Income Shocks

• 成果类型: Article
• 署名作者: Bayer, Christian; Juessen, Falko
• 署名单位: University of Bonn; University of Wuppertal
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.20120163
• 发表日期: 2015
• 页码: 160-187
• 关键词: life satisfaction; consumption inequality; psychological impact; earnings losses; unemployment; RISK; insurance

摘要

We reassess the empirical effects of income and employment on self-reported well-being. Our analysis makes use of a two-step estimation procedure that allows us to apply instrumental variable regressions with ordinal observable data. As suggested by the theory of incomplete markets, we differentiate between the effects of persistent and transitory income shocks. In line with this theory, we find that persistent shocks have a significant impact on happiness while transitory shocks do not. This also has consequences for inference about the happiness effect of employment. We find that employment per se is associated with a nonsignificant decline in happiness.