A Note on Modelling Dynamics in Happiness Estimations

Alan Piper

MPRA Paper from University Library of Munich, Germany

Abstract: This short note discusses two alternative ways to model dynamics in happiness regressions. A explained, this may be important when standard fixed effects estimates have serial correlation in the residuals, but is also potentially useful when serial correlation is not a problem for providing new insights in the happiness of economics area. The note discusses modelling dynamics two ways the note discusses are via a lagged dependent variable, and via an AR(1) process. The usefulness and statistical appropriateness of each is discussed with reference to happiness. Finally, a flow chart is provided summarising key decisions regarding the choice regarding, and potential necessity of, modelling dynamics.

Keywords: Happiness; Dynamics; Lagged Dependent Variable; AR(1) process; Estimation (search for similar items in EconPapers)
JEL-codes: C23 C50 I31 (search for similar items in EconPapers)
Date: 2013-08
New Economics Papers: this item is included in nep-ecm and nep-hap
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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https://mpra.ub.uni-muenchen.de/49709/23/MPRA_paper_49709.pdf revised version (application/pdf)

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