The relationship between income and subjective well-being: Relative or absolute?

Although it appears that income and subjective well-being correlate in within-country studies (Diener, 1984), a debate has focused on whether this relationship is relative (Easterlin, 1974) or absolute (Veenhoven, 1988, 1991). The absolute argument advanced by Veenhoven states that income helps individuals meet certain universal needs and therefore that income, at least at lower levels, is a cause of subjective well-being. The relativity argument is based on the idea that the impact of income or other resources depends on changeable standards such as those derived from expectancies, habituation levels, and social comparisons. Two studies which empirically examine these positions are presented: one based on 18 032 college studies in 39 countries, and one based on 10 year longitudinal data in a probability sample of 4 942 American adults. Modest but significant correlations were found in the U.S. between income and well-being, but the cross-country correlations were larger. No evidence for the influence of relative standards on income was found: (1) Incomechange did not produce effects beyond the effect of income level per se, (2) African-Americans and the poorly educated did not derive greater happiness from specific levels of income, (3) Income produced the same levels of happiness in poorer and richer areas of the U.S., and (4) Affluence correlated with subjective well-being both across countries and within the U.S. Income appeared to produce lesser increases in subjective well-being at higher income levels in the U.S., but this pattern was not evident across countries. Conceptual and empirical questions about the universal needs position are noted. Suggestions for further explorations of the relativistic position are offered.     

Healthy,Wealthy, Wise,and Happy? Assessing Age Differences in Evaluative and Emotional Well-Being Among Mature Adults from Five Low- and Middle-Income Countries

This study assesses the relationship between age and two dimensions of subjective well-being—evaluative and emotional—among mature adults from five low-and middle-income countries. We use data from the World Health Organization’s Study on Global AGEing and Adult Health to contrast the associations of age with subjective well-being when controlling only for gender with the corresponding partial associations when including a richer set of covariates. Adjusting only for gender, we find negative associations of age with evaluative well-being, while the corresponding age gradients for emotional well-being are relatively flat. By contrast, adjusting for further socio-demographic factors results in positive associations of age with both evaluative and emotional well-being. Oaxaca-Blinder decompositions allow us to explore the roles of two factors to account for any unadjusted age differences in subjective well-being: age-group differences in individual characteristics and life circumstances, and age-specific associations of individual characteristics and life circumstances with subjective well-being. While adverse circumstances such as poor health and low income contribute to lower levels of evaluative well-being among older adults, age per se is—ceteris paribus—positively associated with subjective well-being. Even in poorer countries, older age does not need to be a time of low subjective well-being. Policies aimed at preserving income and limiting or compensating old-age disability appear to be key for maintaining subjective well-being among older adults.

     

Bringing Affect Back in: Measuring and Comparing Subjective Well-Being Across Countries

In recent years, researchers and policymakers have paid increasing attention to cross-country comparisons of subjective well-being. Whereas classical theories of quality of life emphasize the central role of affective well-being (i.e., whether a person feels good or bad), previous comparative studies have focused almost exclusively on life satisfaction (i.e., cognitive evaluations of life). This study brings affect into the comparative study of subjective well-being, constructing a new measurement instrument that captures both the affective and cognitive dimensions of subjective well-being. Using European Social Survey data and multi-group confirmatory factor analysis, we estimate latent country means for the two dimensions and compare country rankings across the two measures. The results reveal important differences in country rankings depending on whether one focuses on affective well-being or life satisfaction. We identify crucial differences among top-ranking countries and, perhaps even more importantly, considerable differences in rankings among more moderately ranking countries. In a second step, we compare and evaluate the single-item measures commonly used in previous research with the results based on our new measures. We conclude by discussing our results in relation to previous studies, and in terms of their possible implications for future research and for policymakers bent on improving national levels of subjective well-being.     

Family Structure and Subjective Economic Well-Being: Some New Evidence

The paper investigates the main socio-demographic and economic determinants of subjective economic well-being in different typologies of households. Previous studies have used dummy variables to explore the effect of family structure. In this paper, however four different models—one for each family typology—have been estimated to test if each selected explanatory variable is significant and how it acts in determining the level of subjective economic well-being. To achieve this, we apply an under-used logit model—the partial proportional ordered model. Our analysis, based on data from the 2005 Italian Survey on Income and Living Conditions highlights the main variables affecting the subjective economic well-being of all household typologies. These main variables are related to income adequacy, such as being able to afford housing, clothes and holidays, and also include the work-status and level of education of the respondent. These variables produce notable differences in the level of subjective economic well-being. We find that couples with no children have the highest level of perceived economic well-being, while couples with two or more children and even more so one-person households are more economically insecure.     

The Subjective Well-being Construct: A Test of its Convergent,Discriminant, and Factorial Validity

Using structural equation modeling, we found empirical support for the prevailing theory that subjective well-being consists of three domains: (1) cognitive evaluations of one’s life (i.e., life satisfaction or happiness); (2) positive affect; and (3) negative affect. Multiple indicators of satisfaction/happiness were shown to have strong convergent validity as well as discriminant validity from positive and negative affect. Positive and negative affect likewise exhibited discriminant validity from one another. At both the item and scale levels of analysis, we obtained an intercorrelated three-factor solution corresponding to the three proposed subjective well-being domains.     

Gender Differences in Subjective Well-Being: Comparing Societies with Respect to Gender Equality

These analyses explore the relationship between gender inequality and subjective well-being. The hypothesis was tested as to whether societal gender inequality is related to the size of gender differences in subjective well-being in various societies. Results come from comparative data sets (World Values Survey, involving 57 countries; OASIS project, involving Norway, England, Germany, Spain and Israel). The size of gender differences varied with the extent of societal gender inequality and the cultural attitudes regarding gender equality in different countries. Including individual resources like education and income in the analyses reduced the size of gender and country differences. Gender differences in subjective well-being could therefore be related to gender specific access to goal relevant resources.     

The Role of Family Policy in Explaining the International Variation in Child Subjective Well-Being

The article proposes an innovative analyse for cross-national differences in the subjective child well-being introducing new indicators and measures. This dimension addresses the issue of welfare support to parents and child early education. The question of this research is to what extend family policies can explain the variability of subjective child well-being components in different European countries. Based on this question, the two objective of this proposal are: (1) to review the existing literature with respect to conceptualization, measurement, and correlates of children’s subjective well-being, with a special emphasis on the context of family policies and family well-being in different European welfare states, and (2) to analyse the relation between these policies and subjective child well-being. In order to get these aims we have elaborated two indexes: the index of child subjective well-being and family policy index. Data for HBSC (Health Behaviour in School-aged Children) for the first index and data from OECD Family Database is used to build these indicators. We found that the index of child subjective well-being is comparatively higher in those countries where family policies are more generous in the areas of preschool education, family services, family spending and duration of paid parental leave.     

A first glance into the black box of life satisfaction surrounding childbearing

The vast majority of studies looking into the relationship between childbearing and subjective well-being use overall measures where respondents either report their general level of happiness or their life satisfaction, leaving substantial doubt about the underlying mechanisms. However, life satisfaction and happiness are intuitively multidimensional concepts, simply because there cannot be only one aspect that affects individuals' well-being. In this study, by considering seventeen specific life satisfaction domains, these features come out very clearly. Whereas all the domains considered matter for the overall life satisfaction, only three of them, namely satisfaction with leisure, health and satisfaction with the partnership, change dramatically surrounding childbearing events. Even though we cannot generalise (since these results stem from one particular panel survey, i.e., Household Income and Labour Dynamics in Australia data), it appears that the typical anticipation and post-child decrease of life satisfaction, so often found in existing studies, stems from changes in these three domains.

     

Reference Groups and Pensioners’ Subjective Economic Well-Being in Europe

This study contributes to the interdisciplinary debate over the effects of absolute and relative income on subjective well-being by introducing country-level measures of income into the analysis of pensioners’ economic well-being. Both the relevance of alternative reference groups for different phases of old age, measured through median incomes, and the effect of general income inequality within countries are explored. Analyses are based on the cross-sectional components of the survey European Union Statistics on Income and Living Conditions from 2005 to 2011, containing information on 458,769 pensioners from 31 European countries. With the multilevel linear regression analysis method, the effects of different income measures are analyzed both at the individual and country levels. The main result shows that the average income level of pensioners within countries hold spillover effects strong enough to conclude other pensioners constitute a relevant reference point. Pensioners’ high income level decreases individual income adequacy regardless of age. Results also indicated the labour market group having varying effects on different age groups. The general income inequality does not affect pensioners’ subjective economic well-being.     

Measuring Household Wealth with Latent Trait Modelling: An Application to Malawian DHS Data

Public perceptions of crime and victimisation can influence an individual’s subjective well-being. Research into the impact of the fear of crime and victimisation on subjective well-being, however, has been limited; particularly with respect to the relative contributions of real versus perceived crime towards an individual’s self-reported life satisfaction. Improving our understanding of the relationship between crime and well-being is important, as public resources assigned to reducing or controlling crime could be assigned to addressing other social concerns. This paper extends the literature by exploring the contribution of real and perceived crime in an individual’s local area to their self-reported life satisfaction. Our results indicate that: (1) individuals’ perceptions of crime in their local area are far greater than actual levels of crime; (2) the gap between perceived and real crime is widening as real crime rates fall faster than the perceived rate of crime; (3) real crime rates detract more from an individual’s self-reported life satisfaction than perceived rates of crime; however, (4) perceived rates of crime have an adverse impact on life satisfaction beyond those associated with real crime; and (5) there is significant heterogeneity in the life satisfaction effects of real and perceived crime among groups of individuals. These results, together with empirical evidence highlighting successful strategies for moderating perceptions of crime, facilitate the development of more informed public policy that will improve individual life satisfaction and, ultimately, community well-being.     

The Influence of Value Orientations and Demographics on Quality-of-Life Perceptions: Evidence from a National Survey of Singaporeans

This paper explores the linkages between value orientations, demographics and the quality of life perceptions for Singaporeans based on a nationwide values and lifestyles study conducted in 2001. The quality of life perception is assessed using cognitive evaluations of satisfaction with life in general (subjective personal well-being) and with aspects of living in Singapore (subjective social well-being). Five different value orientations, namely family values, materialism, status consciousness, societal consciousness and traditionalism, are examined for their effects on quality of life. The key demographics used are gender, age, marital status, education and personal income.     

Flourishing Across Europe: Application of a New Conceptual Framework for Defining Well-Being

Governments around the world are recognising the importance of measuring subjective well-being as an indicator of progress. But how should well-being be measured? A conceptual framework is offered which equates high well-being with positive mental health. Well-being is seen as lying at the opposite end of a spectrum to the common mental disorders (depression, anxiety). By examining internationally agreed criteria for depression and anxiety (DSM and ICD classifications), and defining the opposite of each symptom, we identify ten features of positive well-being. These combine feeling and functioning, i.e. hedonic and eudaimonic aspects of well-being: competence, emotional stability, engagement, meaning, optimism, positive emotion, positive relationships, resilience, self esteem, and vitality. An operational definition of flourishing is developed, based on psychometric analysis of indicators of these ten features, using data from a representative sample of 43,000 Europeans. Application of this definition to respondents from the 23 countries which participated in the European Social Survey (Round 3) reveals a four-fold difference in flourishing rate, from 41% in Denmark to less than 10% in Slovakia, Russia and Portugal. There are also striking differences in country profiles across the 10 features. These profiles offer fresh insight into cultural differences in well-being, and indicate which features may provide the most promising targets for policies to improve well-being. Comparison with a life satisfaction measure shows that valuable information would be lost if well-being was measured by life satisfaction. Taken together, our findings reinforce the need to measure subjective well-being as a multi-dimensional construct in future surveys.     

Does National Income Inequality Affect Individuals’ Quality of Life in Europe? Inequality,Happiness, Finances,and Health

This paper analyses the effect of income inequality on Europeans’ quality of life, specifically on their overall well-being (happiness, life satisfaction), on their financial quality of life (satisfaction with standard of living, affordability of goods and services, subjective poverty), and on their health (self-rated health, satisfaction with health). The simple bivariate correlations of inequality with overall well-being, financial quality of life, and health are negative. But this is misleading because of the confounding effect of a key omitted variable, national economic development (GDP per capita): Unequal societies are on average much poorer (r = 0.46) and so disadvantaged because of that. We analyse the multi-level European Quality of Life survey conducted in 2003 including national-level data on inequality (Gini coefficient) and economic development (GDP) and individual-level data on overall well-being, financial quality of life, and health. The individual cases are from representative samples of 28 European countries. Our variance-components multi-level models controlling for known individual-level predictors show that national per capita GDP increases subjective well-being, financial quality of life, and health. Net of that, the national level of inequality, as measured by the Gini coefficient, has no statistically significant effect, suggesting that income inequality does not reduce well-being, financial quality of life, or health in advanced societies. These result all imply that directing policies and resources towards inequality reduction is unlikely to benefit the general public in advanced societies.     

Subjective Well-Being and Life Satisfaction in the Kingdom of Tonga

This paper describes an initial attempt to assess the subjective well being of a sample of 227 Tongans via self-report. Using items adapted from the Subjective Well Being Inventory (SUBI; Nagpal and Sell, 1985; Sell and Nagpal, 1992), participants rated their level of overall life satisfaction along with their perceptions of well-beingin a number of other more specific life domains. Results indicated that mean ratings of global life satisfaction were generally positive. A factor analysis of the remaining domain-specific well-being items indicated that items loaded on to one of two factors dealing with overall positive or negative evaluations of these life areas. Importantly, these scale items stressed the importance of social and kin relations in contributing to overall well-being. In terms of demographic variables, mature respondents reported greater levels of overall life satisfaction and well-being as compared to youthful respondents. Implications and directions for future research are discussed.     

Objective and subjective indicators of community evaluation: A Pennsylvania assessment

The relationships between subjective and objective measures of well-being were assessedusing data from a survey of Pennsylvania residents and county-level statistical measures complied from secondary sources. Following Ross, Bluestone, and Hines (1979), objective social indicators were derived to measure socioeconomic status, family status, health status, and alienation for Pennsylvania countries. These indices were only modestly intercorrelated, suggesting that they measured somewhat different ideas. Subjective well-being was assessed by asking more than 3000 individual respondents to a mail survey to rate the quality of their communities. Responses were dichotomized and logistic regression used to assess the effects of the objective indicators of county well-being to individual community evaluations. The relationships were small, and inconsistent. Implications of the findings are discussed.     

Migrant Workers and Workplace Bullying in Urban China

Trends of subjective well-being (SWB) in transition countries are peculiar: they show substantial changes that are more strongly correlated with the trends of GDP than in other developed countries. This paper examines the role of the trends of GDP and of social trust in predicting the trends of well-being. We find that the strength of the relationship between social trust and SWB over the medium-term is comparable to that of GDP. We conclude that in the medium-term, even in countries where material concerns strongly affect well-being, social trust is a powerful predictor of the trends of SWB. However, in the short run the relationship between social trust and SWB does not hold and GDP stands out as the only significant correlate of SWB.     

Can Governments Boost People’s Sense of Well-Being? The Impact of Selected Labour Market and Health Policies on Life Satisfaction

There is strong evidence that subjective well-being measures capture in a reliable way specific components of well-being that other non-subjective measures miss. The question of whether subjective well-being is policy amenable is however still largely unexplored in the research. This paper sheds some light on this issue, by looking at the impact of selected labour market and health policies on subjective well-being, using well-being data from the Gallup World Poll on the 34 OECD countries. The paper finds that the generosity of unemployment benefits and the strictness employment protection legislation affects positively life satisfaction, while out-of-pocket health expenses significantly reduce subjective well-being.     

MEASURING QUALITY OF LIFE: ECONOMIC,SOCIAL, AND SUBJECTIVE INDICATORS

Thinkers have discussed the “good life” and the desirable society for millennia. In the last decades, scientists offered several alternative approaches to defining and measuring quality of life: social indicators such as health and levels of crime, subjective well-being measures (assessing people's evaluative reactions to their lives and societies), and economic indices. These alternative indicators assess three philosophical approaches to well-being that are based, respectively, on normative ideals, subjective experiences, and the ability to select goods and services that one desires. The strengths and weaknesses of the various approaches are reviewed. It is argued that social indicators and subjective well-being measures are necessary to evaluate a society, and add substantially to the regnant economic indicators that are now favored by policy makers. Each approach to measuring the quality of life contains information that is not contained in the other measures.     

The Influence of Water Access in Subjective Well-Being: Some Evidence in Yucatan, Mexico

The literature on happiness or subjective well-being has explored the determinants of happiness without taking into consideration the role that water plays. In this paper we attempt to draw attention to water in subjective well-being studies. Approximately one hundred million people do not have access to water. A lack of clean water causes diseases such as diarrhea and cholera, responsible for around 5% of the total deaths in the world. Access to water should therefore be a necessary asset in life. In order to consider access to water, we estimate its influence on subjective well-being using data from rural Yucatan, Mexico. Residents in Yucatan suffer from low quality access to water and there are also imperfections in the management of the service, such as water cuts. We estimate the influence of water on subjective well-being, finding a positive and significant relationship. In a second stage of the research, we relate water access variables to subjective well-being, the health and the water domain of life, finding significant results. These results make it possible to formulate political measures concerning access to water and happiness maximization. We demonstrate that access to water is important for well-being in Yucatan and might be important in many other places; we therefore encourage future research to contemplate water satisfaction and water variables in their analysis.     

Social indicators of living conditions in Ireland with European comparisons

This monograph presents data from a nationwide survey of social indicators of living conditions in Ireland. This survey was part of a European Community (EC)-harmonised survey of subjective social indicators carried out in eight EC countries. The survey, the first of two, focussed on people's perceptions of their health, health services, housing, neighbourhood and life in general. Extensive analysis is made of the demographic determinants of a wide range of subjective measures of well-being in all of these life domains. Examination is also made of the predictors of global measures of well-being. Data are presented for Ireland and multi-nation comparative data are also presented throughout. Emphasis is placed on the relationship between objective and subjective social indicators.