Does Money Bring Happiness? Evidence from an Income Shock for Older People

Cuong Nguyen

Finance Research Letters, 2021, vol. 39, issue C

Abstract: There is wide consensus on a positive association between money and happiness. However, estimation of the causal effect of money on happiness is challenging because of the endogeneity bias. In this study, we use the receipt of social pensions as an external income shock to estimate the effect of income on life satisfaction of older people in Vietnam. Using age threshold for social pensions as an instrumental variable for income, we find that higher income helps older people feel more satisfied with their life and other people and also increase the likelihood of having sexual relations.

Keywords: Life satisfaction, Happiness; Household income, Social pensions; Older people (search for similar items in EconPapers)
JEL-codes: H55 I18 J14 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:39:y:2021:i:c:s1544612319304325

DOI: 10.1016/j.frl.2020.101605

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