Income Satisfaction and Relative Deprivation: An Empirical Link

This paper explores the relationship between two well-established concepts of measuring individual well-being: the concept of happiness, i.e. self-reported level of satisfaction with income, and relative deprivation, i.e. the gaps between the individual’s income and the incomes of all individuals richer than him. Operationalizing both concepts using micro panel data from the German Socio-Economic Panel, we provide empirical evidence for subjective well-being depending more on relative deprivation than on absolute levels of income. This finding holds after controlling for other influential factors in a multivariate setting.      

An Individual Relative Deprivation Index and Its Curve Considering Income Scope

China is characterized by a low fertility intention, a strong preference for sons, as well as a stringent birth control policy. In this study, we used data from a Fertility Intention and Behavior Survey of 2101 questionnaires conducted in 2013 in Shaanxi Province of northwestern China, and event history analysis methods to examine the effect of fertility intention and preference for sons on the probability of having a second child. The results not only validate the correlation of fertility intention with having a second child empirically, even in the low fertility intention and stringent birth control context of China, but also show that women with a preference for sons were less likely to have a second child. Women with son preference turn to sex-selective abortion to ensure that their first child is a son, thus reducing the likelihood of a second child and decreasing the fertility rate. Our findings also shed light on China’s potential fertility policy adjustment.     

Relative Income, Inequality and Subjective Wellbeing: Evidence for Brazil

This paper analyzes the determinants of the self-reported income and food sufficiency in Brazil, highlighting how these subjective measures of wellbeing are affected by relative conditions. Analyses are based on pooled data from the 2002/2003 and 2008/2009 Brazilian Family Budget Survey and on estimates of the multinomial relation between income and food sufficiency with absolute and relative indicators. The paper highlights that living in a more affluent neighborhood does matter in self-reported perceptions of wellbeing. Stated income sufficiency depends positively on absolute family income and negatively on relative neighbor income. Moreover, neighborhood education and regional inequality affect both stated perceptions of income and food sufficiency. The paper concludes that improving personal income and education, as well as reducing inequality, is one of the most effective ways to improve both the quality of life and the general perceptions of wellbeing in society.     

Small Area Indices of Multiple Deprivation in South Africa

This paper presents the Provincial Indices of Multiple Deprivation that were constructed by the authors at ward level using 2001 Census data for each of South Africa’s nine provinces. The principles adopted in conceptualising the indices are described and multiple deprivation is defined as a weighted combination of discrete dimensions of deprivation. The methodological approach used is outlined and key findings are presented for one province—the Eastern Cape. The paper summarises the ways in which the research is being developed further and the potential uses of these tools for policy and research.     

The Measurement of Non-economic Inequality in Well-Being Indices

This paper is a critical review of composite well-being indices that account for inequality. Many well-being indices build upon the idea that while income and wealth are important, they do not constitute a person’s actual quality of life. However, first of all, the analysis finds that while well-being indices aim to go “beyond GDP” and other primarily economic indicators, many of them, unfortunately, do not focus on inequality at all. Secondly, most indices which include inequality in their measurement, only account for economic inequality. Thirdly, the article finds that the most comprehensive wellbeing index in terms of inequality is the Inequality-adjusted Human Development Index which adjusts for economic, health and education inequality. This article finds that well-being indices should make further strides to ensure the capture of non-economic inequality in terms of education and health.     

Tracking Poverty Reduction in Bhutan: Income Deprivation Alongside Deprivation in Other Sources of Happiness

This paper analyses poverty reduction in Bhutan between two points in time—2003 and 2007—from a multidimensional perspective. The measures estimated include consumption expenditure as well as other indicators which are directly (when possible) or indirectly associated to valuable functionings, namely, health, education, access to electricity, safe water, improved sanitation, enough room per person in dwelling, access to roads and land ownership. Interestingly, most of these indicators have been identified as sources of happiness in the 2007 Gross National Happiness Survey. Twelve different measures are estimated with a variety of values for the different parameters involved for robustness analysis. Also, estimates are bootstrapped creating 95 % confidence intervals. We find that over the study period there was an unambiguous reduction in multidimensional poverty regardless of the indicators’ weights, deprivation cutoffs and identification criterion of the poor. This reduction was mainly led by a reduction in the proportion of the poor which was accompanied by a reduction in the intensity of poverty among those who were less intensively poor, although not among those who were more intensively poor. Rather than accomplishing this poverty reduction by improving achievements in one or two indicators, there were significant reductions in several deprivations, especially in access to roads, electricity, water, sanitation, and education. We also find that when income alone is used to target the poor, inclusion errors are marginal but exclusion errors are sizeable. Despite Bhutan’s significant progress, challenges remain as poverty is still high in rural areas. A multidimensional measure in the lines proposed in this paper can prove useful for monitoring poverty reduction, prioritizing groups and evaluating upon investment.     

Life Satisfaction Among Turkish and Moroccan Immigrants in the Netherlands: The Role of Absolute and Relative Income

In this paper we investigate the role of several socio-economic and non-economic factors such as absolute and relative income, education and religion to explain the differences of happiness levels of Turkish and Moroccan Immigrants in the Netherlands by using ordered logit model. We focus on members of the Moroccan and Turkish communities, as these are the two largest non-EU immigrant communities in the Netherlands. Our findings reveal that Moroccans, although they have lower income levels and higher unemployment rates than Turkish immigrants, their happiness level is higher than the Turkish immigrants. In order to understand this dilemma a questionnaire survey was performed to 111 Turkish and 96 Moroccan immigrants in Rotterdam, Amsterdam, Den Haag, Utrecht and Arnhem in 2010. The main purpose is to investigate how reference group’s self-reported life satisfaction is related to the level of absolute income; the level of relative income and other socio-economic factors. The main findings are that for Turkish sample relative income is significantly and negatively correlated with life satisfaction whereas, both absolute income (positively) and relative income (negatively) are significantly correlated with life satisfaction for Moroccan case.     

The Impact of Exposure to Other Countries on Life Satisfaction: An International Application of the Relative Income Hypothesis

The cause of international differences in life satisfaction is usually ascribed to differences in living standards. Yet, despite improving living standards in a lot of middle-income countries, significant differences in life satisfaction between middle- and high-income countries remain. This paper examines if there is an international comparison effect and assesses to what extent the relative income hypothesis can be applied to explain international differences in life satisfaction. We test this by analyzing how exposure to other countries impacts life satisfaction. It is hypothesized that higher exposure to other countries in low- and middle-income countries has a negative effect due to increased aspirations and relative deprivation, while the opposite holds true for rich countries. We draw on data from the World Value Survey, the World Bank and the KOF Globalization index to perform a multilevel analysis. The results suggest that an international comparison effect indeed exists and is capable of partially explaining international differences in life satisfaction. Additional analyses reveal that people in lower income classes, in all countries, are affected more by exposure to other countries, indicating that individual characteristics are important when assessing the impact of exposure on life satisfaction. We demonstrate the robustness of these findings by showing that both sub-indicators of exposure, informational flow and international contact, have an impact on life satisfaction that is similar to that of our overall exposure-index.     

Relative Deprivation and Migration in an Agricultural Setting of Nepal

Population and Environment - Are individuals from a relatively more deprived household more likely to migrate for work reasons compared to those from a relatively less deprived household? In this...     

迁移的双重动因及其政策含义--检验相对贫困假说

大多数迁移研究都以托达罗绝对收入差距假设作为解释迁移动因的理论依据。但是,该假说有时并不能完全说明现实中的迁移现象。因此,国外经济学界出现了一个建立在相对贫困假说基础上解释迁移动因的理论。然而,对该理论的经验检验往往是间接的。本文利用贫困农村的调查数据,直接检验了相对贫困假说,发现绝对收入差距与相对贫困同时构成农村劳动力迁移的动因。由此引出的政策含义是,缩小农村收入差距、消除劳动力市场上的扭曲,有利于保证迁移健康、有序地进行。     

The Role of Relative Cohort Size and Relative Income in the Demographic Transition

This paper summarizes the results of other analyses by the author with regard to the importance of relative cohort size (RCS) in determining male relative income (the income of young adults relative to prime-age workers) and general patterns of economic growth, and in turn influencing fertility in the currently more-developed nations. It then goes on to demonstrate that these same effects appear to have been operating in all of the one hundred-odd nations which have experienced the fertility transition since 1950. Parameter estimates based on the experience of all 189 countries identified by the United Nations between 1950 and 1995 are used to simulate the effects on fertility of migration from Third to First World countries. This exercise suggests that we get the best of all possible outcomes with migration: population is reduced in “overcrowded” Third World nations, total world population growth is substantially reduced, and scores of children are given the opportunity of growing up with all the educational and health advantages of U.S. residents.     

Building Weighted-Domain Composite Indices of Life Satisfaction with Data Envelopment Analysis

The specialised literature has frequently addressed the relationship between life domains and people’s satisfaction with life. Some researchers have posed questions regarding the importance of domains, therefore interpreting them as weightings and creating domain satisfaction indices. This paper illustrates how Data Envelopment Analysis (DEA) and Multi-Criteria-Decision-Making (MCDM) techniques can be employed to compute domain-based composite indices of life satisfaction and weightings for life domains. Furthermore, an empirical application is performed on a sample of 178 people living in a rural community in Yucatan (Mexico). One of the main features of the aforementioned techniques is that weightings might differ from one individual to another. Accordingly, several weighting schemes are used to compute different life satisfaction indices, in addition to a constant equally-weighted index. Based on the goodness-of-fit criteria commonly used in this literature, our main result is that DEA-MCDM indicators of life satisfaction do not improve the relationship with self-reported life satisfaction in comparison to the equally-weighted index.     

亲情感对老年人生活满意度的影响

在现实生活中 ,亲情感对老年人的生活满意度有重要影响。家庭居住形式、老年人与亲人互动的精神生活中所体现的亲情感影响着老年人晚年生活的满意度。社会经济文化变迁对老年人亲情满足感会产生一些不利影响 ,社区服务、劳务储蓄等都可以使老年人感到心理充实、增加生活满意度     

The Effect of Income on General Life Satisfaction and Dissatisfaction

Increasing evidence from the empirical economic and psychological literature suggests that positive and negative well-being are more than opposite ends of the same phenomenon. Two separate measures of the dependent variable may therefore be needed when analyzing the determinants of subjective well-being. We investigate asymmetries in the effect of income on subjective well-being with a single-item measure of general life satisfaction. Using data from the German Socio-Economic Panel 1984–2004, and a flexible multiple-index ordered probit panel data model with varying thresholds, we find that income has only a minor effect on high satisfaction but significantly reduces dissatisfaction.     

Measures of Inequality: Application to Happiness in Nations

What is a good measure for happiness inequality? In the context of this question, we have developed an approach in which individual happiness values in a sample are considered as elements of a set and inequality as a binary relation on that set. The total number of inequality relations, each weighed by the distance on the scale of measurement between the pair partners, has been adopted as an indicator for the inequality of the distribution as a whole. For models in which the happiness occurs as a continuous latent variable, an analogous approach has been developed on the basis of differentials. In principle, this fundamental approach results in a (zero) minimum value, and, more importantly, also in a maximum value. In the case where happiness is measured using a k-points scale, the maximum inequality is obtained if all ½N sample members select the lowest possible rating (Eq. 1) and the other ½N the highest possible one (k). This finding even applies to the truly ordinal case, i.e., if the distances between the successive ratings on the scale are unknown. It is, however, impossible to quantify the inequality of some measured sample distribution, unless all distances of the k categories of the scale of measurement are known or at least estimated, either on an empirical basis or on the basis of assumptions. In general, the numerical application of the method to continuous distributions is very complicated. An exploration on the basis of a relatively simple model with a linear probability density function suggests that the inequality of a beta probability distribution with shape parameters a and b increases as the value of these parameters decreases. A contour plot, obtained by numerical integration, demonstrates this relationship in a quantitative way. This approach is applicable to judge the aptness of common statistics of dispersion, among which the standard deviation and the Gini coefficient. The former is shown to be more appropriate than the latter for measuring inequality of happiness within nations.     

收入、相对地位与女性的生育意愿

文章基于中国健康与营养调查（CHNS）2006年成人调查数据,对中国52岁以下在婚、离婚和丧偶女性的收入、相对地位对生育意愿的影响进行实证分析。与以往研究不同的是,在分析影响女性生育意愿的因素时,除了通常的收入、价格、职业和年龄等因素外,本文还特别引入了反映女性相对地位的变量。根据家庭谈判模型以及中国的现实情况,本文用相对收入、相对教育以及相对家务劳动时间来反映女性在家庭中的相对地位。结果显示,对于是否生育孩子的决策,生理因素的影响占据主导地位;对于生育多少个孩子的决策,社会经济因素占据主导地位,尤其是女性在家庭中的相对地位无论城乡均产生显著的影响,而女性的收入对生育意愿并没有产生显著影响。     

Poverty,Inequality and Deprivation in South Africa: An Analysis of the 1993 SALDRU Survey

This paper analyses poverty and inequality in South Africa based on data from a comprehensive multi-purpose household survey undertaken in 1993 to provide baseline statistics on poverty and its determinants to the new government. The paper shows that South Africa has among the highest levels of income inequality in the world and compares poorly in most social indicators to countries with similar income levels. Much of the poverty in the country is a direct result of apartheid policies that denied equal access to education, employment, services, and resources to the black population of the country. As a result, poverty has a very strong racial dimension with poverty concentrated among the African population. In addition, poverty is much higher in rural areas, and particularly high in the former homelands. Poverty among female-headed households and among children is also higher than average. Moreover, poverty is closely related to poor education and lack of employment. The poor suffer from lack of access to education, quality health care, basic infrastructure, transport, are heavily indebted, have little access to productive resources, and are heavily dependent on remittances and social transfers, particularly social pensions and disability grants. The paper uses an income-based definition of poverty for most of the analysis. In addition, it develops a broad-based index of deprivation including income, employment, wealth, access to services, health, education, and perceptions of satisfaction as its components. While on average the two indicators correspond fairly closely, the income poverty measure misses a considerable number of people who are severely deprived in many of the non-income measures of well-being. This group of severely deprived not identified by the income poverty measure consists predominantly of Africans living in rural areas, concentrated particularly in the province of KwaZulu/Natal.