Multidimensionality of Longitudinal Data: Unlocking the Age-Happiness Puzzle

Ning Li
Additional contact information
Ning Li: University of Melbourne

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, 2016, vol. 128, issue 1, No 16, 305-320

Abstract: Abstract In social economic data analysis, sometimes the explanatory variables that are statistically significant in OLS regressions in cross-section or pooled data become insignificant after controlling for individual fixed effects. This phenomenon was observed in the study of the relationship between age and happiness. The discrepancy in estimates between regressions with and without controlling for individual fixed effects was known as the age-happiness mystery. This paper points out that OLS regressions based on cross-section data reflect the difference in average happiness across birth cohorts. In contrast, regressions controlling for individual fixed effects reflect the change in happiness over life cycle within individuals. For the first time in the literature, the co-existence of a cross-section U shape and a longitudinally declining pattern in the relationship between age and happiness is established. Using data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey, this paper explains the exact meaning of fixed-effects regressions of happiness on age, gives insight into the age-happiness puzzle, and raises the awareness of multidimensionality of longitudinal data.

Keywords: Subjective well-being; Cohort effects; Ageing effects; Individual fixed effects; Between-person difference; Within-person difference (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://link.springer.com/10.1007/s11205-015-1032-4 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:soinre:v:128:y:2016:i:1:d:10.1007_s11205-015-1032-4

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11135

DOI: 10.1007/s11205-015-1032-4

Access Statistics for this article

Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement is currently edited by Filomena Maggino

More articles in Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().