EconPapers    
Economics at your fingertips  
 

Preferences, income, and life satisfaction: An equivalence result

Holger Strulik ()

Mathematical Social Sciences, 2015, vol. 75, issue C, 20-26

Abstract: In this paper I investigate the nexus between life time utility (life satisfaction) and income predicted by the standard model of endogenous economic growth under different behavioral assumptions. The solution rationalizes why the empirical association between income and life satisfaction is approximately log-linear. I show that the solution is observationally equivalent when individuals compare their consumption (i) with others, (ii) with their own past consumption achievements, and (iii) not at all (ordinary preferences). This finding suggests that the observed slope of the income–life satisfaction curve is uninformative about the presence and strength of habits or reference-dependent utility.

Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165489615000153
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Preferences, income, and life satisfaction: An equivalence result (2013) Downloads
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:eee:matsoc:v:75:y:2015:i:c:p:20-26

Access Statistics for this article

Mathematical Social Sciences is currently edited by J.-F. Laslier

More articles in Mathematical Social Sciences from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-06-13
Handle: RePEc:eee:matsoc:v:75:y:2015:i:c:p:20-26