Freedom and Rationality as Predictors of Cross-National Happiness Patterns: The Role of Income as a Mediating Variable

Freedom and rationality have traditionally been viewed as essential ingredients to the 'pursuit of happiness'. Previous research has found that the way in which happiness is linked to freedom and other attributes of individualistic society is affected by the income level. This paper formulates a structural model of the linkage between political freedom, rationality, and happiness which takes explicit account of income as a mediating variable. Since income is hypothesized to be linked to the degree of freedom and rationality prevailing in a society, this approach permits to distinguish between direct and indirect linkages of happiness to freedom and rationality. Estimating the model with cross-national data yields the following key findings: (1) Happiness is positively related to freedom as well as to rationality at high freedom/rationality levels and negatively at low levels. (2) Whereas freedom affects happiness only indirectly (through its impact on income), rationality has both direct and indirect effects on happiness.     

Happiness,Comparison Effects,and Expectations in Turkey

It is crucial to know the factors that influence happiness. This study investigates the determinants of happiness with an emphasis on comparison effects (income relative to others’ income or relative to the own income in the past) and expectations about own future income. Nationally representative cross-sectional data collected by a Turkish survey on happiness of individuals 18 or older in years 2003–2011 are used to conduct regression analyses. The dataset includes around 6,000–7,000 individuals in each year. The findings of the study indicate that favorable income comparisons and expectations of future household income are correlated with a higher level of happiness, consistent with a model in which both comparisons and income expectations are seen as a consumption good. Secondly, comparisons and expectations bear on happiness asymmetrically. Third, the estimated effect of expecting higher income is smaller in Turkey than the estimates reported in the literature. Fourth, the magnitudes of the effects of comparisons and expectations depend on the business cycle. In crisis years, compared to years of economic expansion, the importance for happiness of having high absolute income is greater and the importance of having high relative income or high income expectations is lower. Finally, Turkish people have greater concern for their relative position in the society than for having higher absolute income in the future. Several robustness checks lend support to the validity of the aforementioned results.     

The Relationship Between Happiness and Consumption Expenditure: Evidence from Rural China

We use data from the 2016 China Labor-force Dynamics Survey (CLDS) to examine the relationship between happiness and consumption expenditure of rural farmers in China. A two-stage residual inclusion approach is applied to tackle the potential endogeneity issue of happiness. The empirical results show that a higher level of happiness is associated with an increase in consumption expenditure in general. Further analysis reveals that higher levels of happiness are positively and significantly associated with higher expenditures on basic living goods, education and gifts. We also find that both household income and access to the Internet boost happiness and increase consumption expenditure. Happiness plays a larger role in improving the consumption expenditure of rural households compared with their urban counterparts. Our findings may suggest that improving rural income via income diversification strategies and investing in rural information and communication technology infrastructures would encourage rural farmers’ happiness, promote the upgrading of rural consumption and boost sustainable economic growth.

     

Happiness and health behaviours among university students from 24 low,middle and high income countries

The aim of this study was to examine health behaviours and happiness and associated factors in low, middle and high income countries. In a cross-sectional survey, 17 508 undergraduate university students (mean age 20.9, SD = 2. 8) from 25 universities in 24 countries across Asia, Africa and the Americas self-completed anonymous questionnaires. Results indicate that the overall happiness mean score among university students across 24 countries was 13.7 (range 4–20). Generally, the study found that university students from countries of the Caribbean, South America and sub-Saharan Africa had greater happiness scores than students from countries in North Africa and Asia. In multivariate linear regression analysis, better subjective socio-economic status, coming from an higher income country, higher social support, higher intrinsic religiosity, higher personal mastery, positive health behaviours (regular breakfast, adequate physical activity, habitual seatbelt use, regular dental check-ups, not having had an injury, not drinking and driving) and negative health behaviours (not having three or more servings of vegetables and eating red meat daily) were correlated with happiness. Improvement to the happiness of university students should consider regional differences in socio-economic environment.     

A Different Rationale for Redistribution: Pursuit of Happiness in the European Union

This paper considers the role of redistribution in the light of recent research findings on self reported happiness. The analysis and empirical work reported here tries to relate this to a representative actor ‘homo realitus’ and the ‘pursuit of happiness’ rather than the traditional ‘homo economicus’. Econometrically estimating the determinants of happiness in the European Union (EU) using Eurobarometer data and the construction of an ‘Index of Happiness’ facilitates policy simulations. Such simulations find that in terms of average happiness there is little advantage to redistributing income within a country, but more from redistributing income between countries. The importance for happiness of relative income, average standard of living, marital status and age are confirmed. The theoretical rationale for redistribution is also examined.     

Family support, family income, and happiness: a 10-year perspective.

This study examined the role of 2 central aspects of family life--income and social support--in predicting concurrent happiness and change in happiness among 274 married adults across a 10-year period. The authors used hierarchical linear modeling to investigate the relationship between family income and happiness. Income had a small, positive impact on happiness, which diminished as income increased. In contrast, family social support, measured by 3 subscales, Cohesion, Expressiveness, and Conflict, showed a substantial, positive association with concurrent happiness, even after controlling for income. Furthermore, family income moderated the association between family social support and concurrent happiness; family social support was more strongly associated with happiness when family income was low than when family income was high. In addition, change in family social support was positively related to change in happiness, whereas change in family income was unrelated to change in happiness. These findings suggest that happiness can change and underscore the importance of exploring more deeply the role that family relationships play in facilitating such change.     

Understanding money's limits: People's beliefs about the income – Happiness correlation

It is claimed that the correlation between income and happiness is considerably weaker than people expect and recent research supports that contention. However, an important lesson from judgment and decision-making research is that judgments are constructed in response to the prevailing context, leaving open the possibility that some elicitation procedures may reveal accurate intuitions about income and happiness. We examined whether this is so. Study 1 participants ranked a set of empirical relationships according to the strength of correlation and we examined whether they ranked the income–happiness link where it actually falls in the set. In Studies 2 and 3, participants estimated the probability that someone with a higher income than another is also the happier of the two. The estimates of the participants were then compared to the actual probability based on the documented income–happiness relationship. Results indicate that, using these elicitation procedures, people have an accurate understanding of the relationship between income and happiness.     

Social Capital and Happiness: Additional Cross-Country Evidence

Using several different samples, model specifications, and variable proxies, this study revisits the role of social capital in generating life satisfaction (happiness). The main outcome of the exercise is that the parameter for social capital (generalized trust) is extremely fragile, and most estimates show little significant role of social capital in generating happiness. Six additional points are noted. First, the role of income seems generally positive and significant. Second, there are marked parametric differences between high-income and low-income subgroups, but it is difficult to say whether social capital or income is more important in either group. Third, significance of income inequality and of inflation vary considerably across the models and the samples, but their association with happiness is generally weak. Fourth, two measures of happiness (life satisfaction) yield similar sets of estimates. Fifth, there is some indication that “transition” economies are marked by lower happiness while Latin American countries are generally happier. Last, a reasonable test indicates absence of any significant specification error and mitigates worries about possible endogeneities.     

Happiness and Domain Satisfaction in Taiwan

Happiness and life satisfaction are two empirically correlated but nobreak conceptually different measures of well-being. As an emotional state, happiness is sensitive to sudden changes in mood, whilst satisfaction is regarded as a cognitive or judgmental state. Using estimations from two empirical models, the aim of this study is to examine the determinants of happiness and satisfaction amongst nobreak Taiwanese people in a number of life domains. First of all, we attempt to investigate the individual characteristics of happiness by using an ordered probit model. Secondly, using ordinary least squares, we include an individual's value or attitude variables as nobreak determinants of the level of satisfaction with different life domains.Our results suggest that higher income is associated with a higher level of subjective well-being. Measures of comparison income are significantly negatively correlated with the reported level of happiness and job satisfaction, which supports the hypothesis that well-being depends on income relative to a reference group. Consistent with the results from other countries, married people report a higher degree of happiness and satisfaction, whilst the past experience of unemployment significantly reduces subjective well-being. There is little gender difference in happiness or satisfaction with different domains. Furthermore, individual's personal values have strong effects on both marital satisfaction and job satisfaction. The findings of this paper confirm that the effects of personal characteristics are fundamentally different in terms of happiness and satisfaction with specific domains of life.     

Which Ethics Will Make us Individually and Socially Happier? A Cross-Culture and Cross-Development Analytical Model

This paper provides an analytical model representing four polar ethical approaches drawn from the main ethical positions suggested by the philosophical, psychological, and socio-economic literature. Moreover, it develops the model in order to obtain rankings of the four approaches in terms of happiness and, consequently, to provide insights into which ethical approach should best be adopted by each individual, according to his characteristics (income level, in developed countries (DCs) or in less developed countries (LDCs), aspiration level): some dynamics are also predicted, if the Golden and the Copper Rules are applied. Finally, this paper provides insights into which ethical approach should best be adopted by each society, according to its characteristics (DCs or LDCs, social distribution of aspiration levels), by predicting happiness levels in alternative countries, according to the prevailing ethics, and by comparing these predictions with the observed happiness levels, thus providing an empirical test of the analytical model: some dynamics are again predicted, with non-Protestant DCs moving to higher, and Protestant DCs towards lower, happiness levels (conditioned to the per capita income), due to the increasing and decreasing rejection of the Golden and Copper Rules, respectively, and with LDCs moving to lower (conditioned to the increasing per capita income) in the short-run and higher happiness levels in the long run, by establishing and entertaining conditions that set clear incentives for moral behaviour, in order to increase and decrease the adoption of the Golden and Copper Rules, respectively.     

Does Money Buy Immigrant Happiness?

The relationship between income and happiness for international immigrants has been relatively unexplored. A handful of cross-sectional studies has shown that income and happiness are positively correlated after migration, and that wealthier immigrants are more satisfied with their post-migration lives than are their less privileged peers. What is unclear is if the link between income and happiness remains positive as immigrants assimilate to life in a new country. This question is the focus of our study. Using longitudinal data from over 10,000 immigrants tracked up to 30 years in the German Socio-Economic Panel Survey, we set out to provide some insight into the long-term relationship between immigrants’ self-reported life satisfaction and the level of their income in its absolute form. Longitudinal analyses revealed that immigrants who experienced increases in income over time reported greater satisfaction with life and that the income-happiness link remained relatively stable over time. The effect of absolute income on immigrants’ happiness was, nevertheless, small. We also observed that country of origin played an important role in the post-migration association between income and happiness. Income was a stronger predictor of the life satisfaction of immigrants from poorer origins than it was for their wealthier counterparts.     

From wealth to well-being? Money matters,but less than people think

While numerous studies have documented the modest (though reliable) link between household income and well-being, we examined the accuracy of laypeople's intuitions about this relationship by asking people from across the income spectrum to report their own happiness and to predict the happiness of others (Study 1) and themselves (Study 2) at different income levels. Data from two national surveys revealed that while laypeople's predictions were relatively accurate at higher levels of income, they greatly overestimated the impact of income on life satisfaction at lower income levels, expecting low household income to be coupled with very low life satisfaction. Thus, people may work hard to maintain or increase their income in part because they overestimate the hedonic costs of earning low levels of income.     

Institutional Origins of Subjective Well-Being: Estimating the Effects of Economic Freedom on National Happiness

We exploit the cross-country differences in economic freedom to examine the link between the quality of institutions and subjective well-being. Using Veenhoven’s happiness dataset, the evidence suggests countries with better economic institutions and higher level of economic freedom, captured by the security of property rights, open markets and more limited government, are significantly more likely to experience greater subjective well-being after controlling for structural confounders of national subjective well-being such as income, unemployment, inequality, social capital and life satisfaction. The effect of institutions on cross-national happiness is both significant and robust to different model specifications, estimation techniques and possible sources of endogeneity. Furthermore, our panel data analysis reveals that over time higher levels of economic freedom are associated with decreasing subjective well-being after controlling for state dependence and income.     

The Optimum Level of Well-Being: Can People Be Too Happy?

ABSTRACT— Psychologists, self-help gurus, and parents all work to make their clients, friends, and children happier. Recent research indicates that happiness is functional and generally leads to success. However, most people are already above neutral in happiness, which raises the question of whether higher levels of happiness facilitate more effective functioning than do lower levels. Our analyses of large survey data and longitudinal data show that people who experience the highest levels of happiness are the most successful in terms of close relationships and volunteer work, but that those who experience slightly lower levels of happiness are the most successful in terms of income, education, and political participation. Once people are moderately happy, the most effective level of happiness appears to depend on the specific outcomes used to define success, as well as the resources that are available.     

Are East Asians happy to work more or less? Associations between working hours,relative income and happiness in China,Japan, South Korea and Taiwan

As East Asians are, on average, less happy than those in economically developed Western nations, more insights regarding the associations between work, income and happiness are needed. This study analyzes data from the 2010 East Asian Social Survey to investigate these associations in China, Japan, South Korea and Taiwan, and is framed in a similar context as previous studies that utilize data from Western nations and through the lens of social comparison theory. Path analysis is used to model the associations between happiness and its predictors while taking correlations between the predictors into account. Results show that working hours are negatively associated with happiness in China, Japan and Taiwan, but such an association is not observed in South Korea. At the same time, relative income is significantly associated with happiness in all four East Asian nations, but it only mediates the association between working hours and happiness in China. These results suggest that careful consideration of economic and labour policies are critical to promote the happiness of East Asian workers. Findings from this study are useful for further inquiries with regard to specific explanatory factors of the associations between working hours, relative income and happiness in East Asia.     

Income inequality and happiness

Using General Social Survey data from 1972 to 2008, we found that Americans were on average happier in the years with less national income inequality than in the years with more national income inequality. We further demonstrated that this inverse relation between income inequality and happiness was explained by perceived fairness and general trust. That is, Americans trusted other people less and perceived other people to be less fair in the years with more national income inequality than in the years with less national income inequality. The negative association between income inequality and happiness held for lower-income respondents, but not for higher-income respondents. Most important, we found that the negative link between income inequality and the happiness of lower-income respondents was explained not by lower household income, but by perceived unfairness and lack of trust.     

Ignoring Easterlin: Why Easterlin’s Correlation Findings Need Not Matter to Public Policy

Many believe that the lack of correlation between happiness and income, first discovered by Richard Easterlin in 1974, entails the conclusion that well-being policies should be made based on happiness measures, rather than income measures. I argue that distinguishing between how well-being is characterized and how that characterization is measured introduces ways of denying the conclusion that policies should be made based on happiness measures. It is possible to avoid the conclusion either by denying that well-being hedonism is true or by denying that happiness measures are a better way of operationalizing hedonism than income measures are. By making these possibilities explicit, we find that less hinges on whether income and happiness are correlated than is often thought.     

Buying well‐being: Spending behavior and happiness

The relationship between money and happiness is complex. While a large literature demonstrates a small but significant positive association between overall income and well‐being, a relatively new area of research explores the emotional consequences of everyday spending choices. Here we review this recent but rapidly growing area of investigation. We begin by briefly summarizing the link between money and happiness. Then, through the lens of 2 dominant models of human happiness, we suggest that seemingly inconsequential spending choices may provide an underappreciated and underutilized route to greater well‐being. Finally, we review new empirical evidence demonstrating that individuals can use their disposable income to increase their happiness by investing in experiential (rather than material) purchases, more free time, routine, self‐expression, and generosity.     

Does More Money Make You Happier? Why so much Debate?

Easterlin’s famous paradox questioned standard economic assumptions about a fundamental relationship in economics: that between happiness and income. In recent years there has been renewed debate about the paradox. In this essay, I highlight some of the methodological issues and challenges underlying that debate. I focus on the sensitivity of the results to the method selected, the choice of micro or macro data, and the way that happiness questions are defined and framed, all of which result in divergent conclusions. I also note the mediating role of the pace and nature of economic growth, institutional frameworks, and inequality. What is most notable is the remarkable consistency in the determinants of individual happiness – including income – within countries of diverse income levels and, at the same time, how happiness is affected by cross-country differences that are related to average per-capita income levels, such as political freedom and public goods. Income clearly plays a role in determining both individual and country level happiness. Still, assessing its role relative to other more difficult to measure factors as countries develop in new ways and at different rates will remain a challenge for the foreseeable future.     

Does Happiness Pays? A Longitudinal Family Life Survey

Most of the research on happiness has documented that income, marriage, employment and health affect happiness. Very few studies examine whether happiness itself affect income, marriage, employment and health. This study does so, benefiting from data drawn from the panel longitudinal Indonesian Family Life Survey (IFLS) 2007 and 2014. The survey includes 23,776 individuals from 15,067 households living in about 262 neighborhoods between 2007 and 2014. The findings show that happier Indonesians in 2007 earned more money, were more likely to be married, were less likely to be divorced or unemployed, and were in better health when the survey was conducted again seven years later. Policy makers may consider that increasing citizen happiness is vital to achieve citizen success on labor markets, to improve their job performance and to maintain their health.