Subjective Measures of Economic Well-Being and the Influence of Income Uncertainty

Johannes Schwarze
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Johannes Schwarze: University of Bamberg

No 3720, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper provides evidence that subjective measures of individual well being can be used to study the impact of income uncertainty from an ex ante point of view. Two different measures of subjective well being are under study: Satisfaction with household income and the income evaluation question as developed by Van Praag. It can be shown that satisfaction with income is more affected by ex ante than by ex post volatility of income. The ordinal version of the Van Praag approach might be biased if income uncertainty is essential. The paper was written in 1994.

Keywords: income uncertainty; subjective well-being; satisfaction; income evaluation (search for similar items in EconPapers)
JEL-codes: C23 D12 D81 I31 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2008-09
New Economics Papers: this item is included in nep-hap and nep-ltv
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Citations: View citations in EconPapers (2)

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