Climbing up ladders and sliding down snakes: an empirical assessment of the effect of social mobility on subjective wellbeing
Paul Dolan and
Grace Lordan ()
LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library
We examine how intergenerational mobility impacts on subjective wellbeing (SWB) drawing on data from the British Cohort Study. Our SWB measures encapsulate both life satisfaction and mental health, and we consider both relative and absolute movements in income. We find that relative income mobility is a significant predictor of life satisfaction and mental health, whether people move upward or downward. For absolute income, mobility is only a consistent predictor of SWB and mental health outcomes if the person moves downwards, and in this case the impact is far larger than relative mobility. For both relative and income mobility, downward movements impact SWB to a greater extent than upward movements, consistent with exhibiting loss aversion. Notably, we find that social class mobility does not affect SWB. We present evidence that the significant relative and absolute mobility effects we find operate partially through financial perceptions and consumption changes which can occur because of income mobility.
Keywords: income mobility; life satisfaction; mental health; social class mobility; subjective wellbeing (search for similar items in EconPapers)
JEL-codes: D31 D63 J60 (search for similar items in EconPapers)
Pages: 23 pages
New Economics Papers: this item is included in nep-eur, nep-hap and nep-hea
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Published in Review of Economics of the Household, 14, May, 2020. ISSN: 1569-5239
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Working Paper: Climbing up Ladders and Sliding down Snakes: An Empirical Assessment of the Effect of Social Mobility on Subjective Wellbeing (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:104059
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