Can policy make us happier? Individual characteristics, socioeconomic factors, and life satisfaction in Central and Eastern Europe

Andrés Rodríguez-Pose and Kristina Maslauskaite
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Kristina Maslauskaite: College of Europe, Bruges, Belgium

No 2011-19, Working Papers from Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales

Abstract: In the last decade, Central and Eastern European (CEE) countries have witnessed a rapid economic convergence vis-à-vis Western Europe. However, this rapid growth has not been matched by a similarly rapid increase in life satisfaction, which has remained low in the European context. This paper sets out to address this conundrum, by looking at the individual and macro-level determinants of individual life satisfaction in ten CEE countries. The results highlight that while Central and Eastern Europeans share the same individual determinants of happiness as people in the West (despite some significant cross-country variation), macroeconomic and institutional differences are the key factors behind the lack of convergence in life satisfaction. On the macroeconomic side, GDP growth is still a source of increasing well-being, but the happiness bonus associated with it is becoming smaller. The different levels of individual happiness in CEE are therefore mostly determined by institutional factors such as corruption, government spending and decentralisation, making policies aimed at enhancing institutional quality capable of bringing about substantial improvements in the overall life satisfaction of the people in the region.

Keywords: Happiness; Convergence; Easterlin paradox; Institutions; Corruption; Decentralisation; Central and Eastern Europe (search for similar items in EconPapers)
Date: 2011-11-10
New Economics Papers: this item is included in nep-cwa, nep-eur, nep-hap and nep-tra
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Citations: View citations in EconPapers (10)

Published in Cambridge Journal of Regions Economics and Society 5(1), March 2012: 77-96

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Journal Article: Can policy make us happier? Individual characteristics, socio-economic factors and life satisfaction in Central and Eastern Europe (2011)
Working Paper: Can policy make us happier? Individual characteristics, socioeconomic factors, and life satisfaction in Central and Eastern Europe (2011)
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