Reported Subjective Well-Being: A Challenge for Economic Theory and Economic Policy

Alois Stutzer and Bruno Frey

CREMA Working Paper Series from Center for Research in Economics, Management and the Arts (CREMA)

Abstract: Over the past few years, there has been a steadily increasing interest on the part of economists in happiness research. This paper argues that reported subjective well-being is a satisfactory empirical approximation to individual utility and endeavors to provide an impression of this new, and challenging, development. We study data from the German Socio-Economic Panel to better understand (i) the role of aspirations in the relationship between income and happiness and (ii) the effect of unemployment on people?s satisfaction with life. We discuss some of the consequences for economic policy and for economic theory.

Keywords: aspiration level; relative income; subjective well-being; unemployment; utility (search for similar items in EconPapers)
JEL-codes: D60 I31 J60 (search for similar items in EconPapers)
Date: 2003-07
New Economics Papers: this item is included in nep-cbe
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Citations: View citations in EconPapers (12)

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Journal Article: Reported Subjective Well-Being: A Challenge for Economic Theory and Economic Policy (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:cra:wpaper:2003-07

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