(Mis-)Predicted Subjective Well-Being Following Life Events

Reto Odermatt and Alois Stutzer

CREMA Working Paper Series from Center for Research in Economics, Management and the Arts (CREMA)

Abstract: The correct prediction of how alternative states of the world affect our lives is a cornerstone of economics. We study how accurate people are in predicting their future well-being after facing major life events. Based on individual panel data, we compare people's life satisfaction forecasts reported in the first interview after a major life event with their actual evaluations five years later on. This is done after the individuals experience widowhood, unemployment, disability, marriage, separation or divorce. We find systematic prediction errors that seem at least partly driven by unforeseen adaptation after the first four of these events.

Keywords: Adaptation; life satisfaction; life events; projection-bias; subjective well-being; utility prediction; unemployement (search for similar items in EconPapers)
JEL-codes: D03 D12 D60 I31 (search for similar items in EconPapers)
Date: 2017-09
New Economics Papers: this item is included in nep-hap, nep-hpe and nep-ltv
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: (Mis-)Predicted Subjective Well-Being Following Life Events (2019)
Working Paper: (Mis-)Predicted Subjective Well-Being Following Life Events (2015)
Working Paper: (Mis-)Predicted Subjective Well-Being Following Life Events (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:cra:wpaper:2017-12

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