The Half-Life of Happiness: Hedonic Adaptation in the Subjective Well-Being of Poor Slum Dwellers to a Large Improvement in Housing

Sebastian Galiani, Paul Gertler and Raimundo Undurraga

No 21098, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Subjective well-being may not improve in step with increases in material well-being due to hedonic adaptation, a psychological process that attenuates the long-term emotional impact of a favorable or unfavorable change in circumstances, such that people’s happiness eventually returns to a stable reference level. We use a multi-country field experiment to examine the impact of the provision of improved housing to extremely poor populations on subjective measures of well-being to test whether poor populations exhibit hedonic adaptation when their basic housing needs are met. After sixteen months, we find that subjective perceptions of well-being improve substantially for recipients of better housing but that after, on average, eight additional months, 60% of that gain disappears.

JEL-codes: I31 (search for similar items in EconPapers)
Date: 2015-04
New Economics Papers: this item is included in nep-hap, nep-lam, nep-ltv and nep-ure
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Citations: View citations in EconPapers (12)

Published as Sebastian Galiani, Paul J Gertler, Raimundo Undurraga; The Half-Life of Happiness: Hedonic Adaptation in the Subjective Well-Being of Poor Slum Dwellers to the Satisfaction of Basic Housing Needs, Journal of the European Economic Association, , jvx042, https://doi.org/10.1093/jeea/jvx042

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Working Paper: The Half-Life of Happiness: Hedonic Adaptation in the Subjective Well-Being of Poor Slum Dwellers to a Large Improvement in Housing (2015)
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