How the income of others affects the life satisfaction of materialists

Benjamin Schalembier, Brent Bleys, Luc Van Ootegem and Elsy Verhofstadt

Journal of Economic Behavior & Organization, 2020, vol. 174, issue C, 64-74

Abstract: In this study we investigate to what degree the link between income and life satisfaction depends on materialistic values. In addition to the impact of absolute income, we also look at how the impact of self-perceived relative income on life satisfaction is affected by materialism. In order to test this, we perform regression analyses on a sample of 1149 Flemish citizens. Materialism is defined and operationalized as in Richins and Dawson (1992), who measure materialism by looking at three dimensions: to what degree do people think that (1) material goods will lead to happiness, (2) acquiring material goods is a central part of life and (3) possessions signal success. Our results show that the impact of income on life satisfaction is attributable to relative income, rather than absolute income, and that its effect is strongly moderated by materialistic values. The impact of relative income is exacerbated for those who are very materialistic, while those who are not materialistic at all are barely negatively affected by a lower relative income. When we analyze how the dimensions of materialism affect the relation between income and life satisfaction, we find that the role of possessions in defining success significantly moderates this link, while the other two dimensions, the role of acquisition in happiness and acquisition centrality, do not. These results illustrate that the life satisfaction of materialists is affected by income, not because material goods are more important for their subjective well-being, but because they are more negatively affected by the incomes of others.

Keywords: Comparison income; Income; Life satisfaction; Materialism; Relative income (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:174:y:2020:i:c:p:64-74

DOI: 10.1016/j.jebo.2020.03.022

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