Isolation and Subjective Welfare

Marcel Fafchamps, Forhad Shilpi and The World Bank

No 216, Economics Series Working Papers from University of Oxford, Department of Economics

Abstract: Using detailed geographical and household survey data from Nepal, this article investigates the relationship between isolation and subjective welfare. This is achieved by examining how distance to markets and proximity to large urban centers affect responses to questions about income and consumption adequacy. Controlling for migration, results show that isolation significantly reduce subjective assessments of income and consumption adequacy. Part of this effect can be attributed to lower access to public goods and to a reduction in the variety of consumption items. Compensating variation estimates suggest that the subjective cost of isolation is large. We also find strong evidence that Nepalese households cannot relocate costlessly out of their village of origin.

Keywords: Geographical Isolation; Subjective Well-Being; Migration (search for similar items in EconPapers)
JEL-codes: O18 R20 (search for similar items in EconPapers)
Date: 2004-12-01
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Citations: View citations in EconPapers (1)

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Working Paper: Isolation and Subjective Welfare (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:oxf:wpaper:216

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