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Measuring the Monetary Value of Social Relations: a Hedonic Approach

Emilio Colombo () and Luca Stanca ()

No 256, Working Papers from University of Milano-Bicocca, Department of Economics

Abstract: This paper presents an application of the hedonic approach to measure the monetary price of social relations. We use individual-level data for housing and labor markets in 103 Italian cities to estimate the price of relational amenities and construct monetary indexes of quality of relational life. We focus on time spent with friends, active participation in associations and frequency of going out for leisure activities, while controlling for standard amenities such as weather, environment, services, and socio-demographic characteristics. We find that individuals are willing to pay a positive and significant monetary price to live in cities where people spend more time with their friends. A one standard deviation increase in the share of those who meet their friends most frequently is worth an extra \euro 1,150 per year in terms of higher housing costs and foregone wages.

Keywords: social relations; social capital; hedonic prices; quality of life; well-being (search for similar items in EconPapers)
JEL-codes: A13 C4 D6 I31 R2 Z13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hap, nep-ltv, nep-soc and nep-ure
Date: 2013-10, Revised 2013-10
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http://repec.dems.unimib.it/repec/pdf/mibwpaper256.pdf First version, 2013 (application/pdf)

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Journal Article: Measuring the monetary value of social relations: A hedonic approach (2014) Downloads
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