The Lasting Well-being Effects of Early Adulthood Macroeconomic Crises

Matti Hovi
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Matti Hovi: Faculty of Management and Business, Tampere University

No 1823, Working Papers from Tampere University, Faculty of Management and Business, Economics

Abstract: This paper studies the effects of macroeconomic crises experienced in early adulthood on subjective well-being later in life. Using repeated cross-sectional survey data of over 100 000 individuals from 38 countries around the world combined with historical data on macroeconomic circumstances, I find that having experienced a macroeconomic crisis at ages 18 to 25 is detrimental to subjective well-being. This result is in line with earlier literature that focuses on other individual-level outcomes. However, the analysis presented in this paper reveals that outcomes related to individual’s earnings, employment status, family life, and religion cannot fully explain the lasting effect of a macroeconomic crises on well-being. Results on heterogeneous responses show that the negative effect is largest for females and for individuals with low educational attainment.

Keywords: Subjective well-being; Happiness; Life satisfaction; Macroeconomic crises; Recession (search for similar items in EconPapers)
JEL-codes: I31 O11 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2020-05
New Economics Papers: this item is included in nep-hap
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http://urn.fi/URN:ISBN:978-952-03-1604-4 Second version, 2020 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:tam:wpaper:1823

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