Search

For representative German panel data, we show that voluntary job switching leads to relatively high levels of life satisfaction, though only for some time, whereas the impact of exogenously triggered job changes is ambiguous. Risk aversion interacts negatively with this effect in life satisfaction. Analysing time-use data and well-being indicators for various areas of life, we find evidence that involuntary job mobility turns out to be harmful for satisfaction with family life. By linking this relatively new measure of family well-being to domestic events, such as future child births, our paper reveals a behaviourally valid predictor of great economic relevance.

The COVID-19 pandemic created the largest experiment in working from home. We study how persistent telework may change energy and transport consumption and costs in Germany to assess the distributional and environmental implications when working from home will stick. Based on data from the German Microcensus and available classifications of working-from-home feasibility for different occupations, we calculate the change in energy consumption and travel to work when 15% of employees work full time from home. Our findings suggest that telework translates into an annual increase in heating energy expenditure of 110 euros per worker and a decrease in transport expenditure of 840 euros per worker. All income groups would gain from telework but high-income workers gain twice as much as low-income workers. The value of time saving is between 1.3 and 6 times greater than the savings from reduced travel costs and almost 9 times higher for high-income workers than low-income workers. The direct effects on CO₂ emissions due to reduced car commuting amount to 4.5 millions tons of CO₂, representing around 3 percent of carbon emissions in the transport sector.

Contact restrictions and distancing measures are among the most effective non-pharmaceutical measures to stop the spread of the SARS-CoV2 virus. Yet, research has only begun to understand the wider social consequences of these interventions. This study investigates how individuals’ social networks have changed since the outbreak of the pandemic and how these changes relate to psychological strain. Based on an online survey of the German adult population, four types of change are distinguished: loss, gain, and intensification of ties, as well as pandemic-related conflicts. One in two respondents has experienced at least one of these four changes. Loss is more frequently reported than gain of ties, and intensification occurred more frequently than conflicts. Loss of ties and conflicts are furthermore associated with higher levels of psychological strain. published

Econometric analyses of European datasets suggest that income aspirations increase with current income. This finding is consistent with the adaptation hypothesis – the notion that individual aspirations adjust to reflect personal circumstances and living conditions. We add to these existing studies in two ways: we investigate the relationship between aspirations and living conditions within a developing country rather than a developed country context, thereby extending the analysis to individuals with considerably poorer living conditions; and we expand the analysis to look not only at income but also at educational and health aspirations. Like earlier studies we find that income aspirations increase with both the individual’s own actual income and the incomes of those around them. We also find a positive relationship between actual and aspired to education. However, with respect to health, we find that people aspire to more rather than less health when surrounded by others who are ill.

How well did Kenyans do under colonial rule? It is common sense that Kenyans suffered under exploitative colonial policies. The overall impact, however, is uncertain. This study presents fresh evidence on nutrition and health in colonial Kenya by (1) using a new and comprehensive data set of African army recruits and civilians and (2) applying a powerful measure of nutritional status: mean population height. Findings demonstrate huge regional inequalities but only minor changes in the mean height of cohorts born 20 years before and after colonisation. From 1920 onwards secular improvements took place which continued after Independence. It can be concluded that however bad colonial policies and devastating short term crises were, the net outcome of colonial times was a significant progress in nutrition and health.

We explore how to measure poverty over time, by focusing on trajectories of poverty rather than poverty at a particular point in time. We consider welfare outcomes over a period in time, consisting of a number of spells. We offer a characterization of desirable properties for measuring poverty across these spells, as well as an explicit discussion of three issues. First, should there be scope for compensation so that a poor spell can be compensated for by a non-poor spell? Second, is there scope for discounting or should all spells be equally valued? Third, does the actual sequence of poor spells matter, for example whether they are consecutive or not? We offer a number of measures that implicitly offer different answers to these questions, in a world of certainty. Finally, we also offer an extension towards a forward-looking measure of vulnerability, defined as the threat of poverty over time, that incorporates risk. An application to data from Ethiopia shows that especially the assumption of compensation results in different inference on poverty.

We propose to measure inequality of well-being with a multidimensional generalization of the Gini coefficient. We derive two inequality indices from their underlying social evaluation functions. These functions are conceived as a double aggregation functions: one across the dimensions of well-being, and another across the individuals. They differ only with respect to the sequencing of aggregations. We argue that the sequencing that does not exclude the Gini index to be sensitive to the correlation between the dimensions is more attractive. We illustrate both Gini indices using Russian household data on three dimensions of well-being: expenditure, health and education.

Do local populations benefit from resource booms? How strong are market linkages between the mining sector and the regional economy? This paper exploits exogenous variation in mine-level production volumes generated by the recent copper boom in Zambia to shed light on these questions. Using a novel dataset, I find robust evidence that an increase in local copper production improves living standards in the surroundings of the mines even for households not directy employed in the mining sector: a 10% increase in constituency-level copper output is associated with a 2% increase in real household expenditure; positive effects on housing conditions, consumer durable ownership and child health are of similar magnitude. The positive spill-overs extend to the rural hinterland of mining cities, neighboring constituencies, and constituencies to the copper transportation route. Additionally,I identify boom-induced changes in the demand for servics and agricultural products as key channels through which the urban and rural populations benefit from the mine expansions. Since the boom failed to generate fiscal revenues, these effects can be interpreted as the result of the mines' backward linkages. Taken together, these findings highlight the welfare potential of local procurement policies in resource rich developing countries.

Along with China becoming an upper-middle-income country from a lower-middle-income one after 2009, the happiness inequality in China has been enlarged. Based on the Chinese General Social Survey (CGSS) database (2003-2012), this paper investigates the determinants of the happiness inequality in China and explores what factors contribute to its enlargement after 2009. We find that a rise of income inequality as well as the population share of middle age cohorts can widen China’s happiness inequality, while an increase in income or education level has a reducing impact. Owning a house and being in employment also have happiness inequality reducing impacts. A decomposition analysis shows that the deterioration of China’s happiness inequality is mainly caused by coefficient effects, i.e., the relationships between happiness inequality and its influencing factors have changed, which reflects the dramatic change in the Chinese economy and society. Among the coefficient effects, regional heterogeneity plays an important role. Policies enhancing economic performance and education as well as reducing income inequality and regional inequality can help to reduce happiness inequality and improve social harmony in China.

We investigate the unexplored link between the risk of poverty and happiness in the context of a developing country. Using unique longitudinal data, we estimate workers’ vulnerability to income poverty and find a strong negative relationship between vulnerability and life satisfaction, over and above the positive income effect commonly documented in the literature. The result is robust and cannot be reduced to the effect of two-sided uncertainty. A matched behavioral experiment shows that respondents are significantly loss averse. We conclude that downside risk is an important determinant of happiness and of economic decisions under uncertainty. Policies that mitigate downward risk may thus have direct impacts on both well-being and efficiency.

The correct prediction of how alternative states of the world affect our lives is a cornerstone of economics. We study how accurate people are in predicting their future well-being after facing major life events. Based on individual panel data, we compare people's life satisfaction forecasts reported in the first interview after a major life event with their actual evaluations five years later on. This is done after the individuals experience widowhood, unemployment, disability, marriage, separation or divorce. We find systematic prediction errors that seem at least partly driven by unforeseen adaptation after the first four of these events.

A large literature documents the correlates and causes of subjective well-being, or happiness. But few studies have investigated whether people choose happiness. Is happiness all that people want from life, or are they willing to sacrifice it for other attributes, such as income and health? Tackling this question has largely been the preserve of philosophers. In this article, we find out just how much happiness matters to ordinary citizens. Our sample consists of nearly 13,000 members of the UK and US general populations. We ask them to choose between, and make judgments over, lives that are high (or low) in different types of happiness and low (or high) in income, physical health, family, career success, or education. We find that people by and large choose the life that is highest in happiness but health is by far the most important other concern, with considerable numbers of people choosing to be healthy rather than happy. We discuss some possible reasons for this preference.

High school baseball is very popular in Japan. All games of the high school baseball tournaments are publicly broadcasted. This paper hypothesizes that high school baseball influences the happiness level of the Japanese. Individual level data in Japan was used to test this hypothesis. The key findings of the study were as follows. (1) The number of wins of a team representing a prefecture increased the happiness level of its residents. (2) This effect was only observed for residents of large cities and not for other areas. (3) For migrants who had moved from rural to urban areas, the effect of their home team wins was greater than that of the wins of the team representing their current residence. This effect was significant in cases where the cultural climate of the host area differed from that of the migrant’s home area. The findings of this study support the argument that a scarcity of goods related to the residential community increases the influence of high school baseball on happiness. Further, nostalgia for home influences migrants’ happiness, and this influence is greater than the attachment they form to their current residential community.

We estimate the long-term effects of start-up subsidies (SUS) for the unemployed on subjective outcome indicators of well-being, as measured by the participants’ satisfaction in different domains. This extends previous analyses of the current German SUS program (“Gründungszuschuss”) that focused on objective outcomes – such as employment and income – and allows us to make a more complete judgment about the overall effects of SUS at the individual level. This is especially important because subsidizing the transition into self-employment may have unintended adverse effects on participants’ well-being due to its risky nature and lower social security protection, especially in the long run. Having access to linked administrative-survey data providing us with rich information on pre-treatment characteristics, we base our analysis on the conditional independence assumption and use propensity score matching to estimate causal effects within the potential outcomes framework. We find long-term positive effects on job satisfaction but negative effects on individuals’ satisfaction with their social security situation. Further findings suggest that the negative effect on satisfaction with social security may be driven by negative effects on unemployment and retirement insurance coverage. Our heterogeneity analysis reveals substantial variation in effects across gender, age groups and skill levels. The sensitivity analyses show that these findings are highly robust.

We provide a new explanation for the stronger relationship between income and subjective well-being (SWB) found in cross-sectional versus panel studies based on the predictions of a rational expectations model of utility maximization with permanent and transitory income shocks. The model predicts that SWB is affected by unanticipated rather than anticipated income, and is more influenced by permanent rather than transitory income shocks. We hypothesize that share of cross-sectional income variation accounted for by permanent income is greater than the share of changes in income over time accounted for by unanticipated shocks to permanent income. We test our predictions using a unique panel dataset from rural China which includes subjective expectations of future income and actual income in each wave, enabling us to separately identify the effects of unanticipated permanent and transitory income shocks. The results confirm the predictions, providing support for the importance of permanent income in explaining SWB.

Contract farming is often seen as a panacea to many of the challenges faced by agricultural production in developing countries. Given the large heterogeneity of contract farming arrangements, it is debatable whether all kinds of contract farming arrangements offer benefits to participating smallholders. We apply matching methods to analyze the effects of a public sugarcane outgrower scheme in Ethiopia. Participation in the outgrower scheme significantly reduces the income and asset stocks of outgrowers who contributed irrigated land to the outgrower scheme, while the effect was insignificant for outgrowers who contributed rain-fed land. We provide several explanations and discuss policy implications.

Using data from the World Values Survey and the European Values Study, we compare the trends of materialism over the last quarter of century among the US and six major European countries: France, Spain, Italy, Germany, Great Britain and Sweden. We use the definition of materialism adopted by positive psychologists. We find that the trends in Europe and in the US diverged. In the US materialism increased, while in Europe it decreased. However, some mixed patterns arise. In particular, Great Britain, Spain and Sweden showed some symptoms of an increase of materialistic values, although they were far less pronounced compared to the American ones. As far as the levels of materialism are concerned, it is interesting that, according to most of our measures, Americans were relatively less materialistic at the beginning of our period of observation. Yet, towards the end of the period they scored very high in the ranking of materialism in our sample of countries.

Conceptualizing externalities from perceived nuclear risk as being related to distance from nuclear facilities, we estimate the relationship between Swiss citizens’ life satisfaction (understood as a proxy of utility) and the distance of their place of residence from the nearest nuclear power plant. Controlling for a rich set of life satisfaction factors, we find a statistically and economically significant satisfaction-distance gradient, whose monetary value amounts to CHF 291 per kilometer of distance, on average. The gradient is smaller for those who may feel protected by wind direction and topographical conditions, and it differs by age, sex, and the level of education. The satisfaction-distance gradient has changed significantly after the nuclear disaster at Fukushima, Japan, indicating a reassessment of distance-dependent nuclear risk. We find no evidence of hedonic locational equilibrium with respect to nuclear risk.

The authors update previous findings on the total East-West gap in overall life satisfaction and its trend by using data from the German Socio-Economic Panel (SOEP) for the years 1992 to 2013. Additionally, the East-West gap and its trend are separately analyzed for men and women as well as for four birth cohorts. The results indicate that reported life satisfaction is on average significantly lower in East than in West German federal states and that part of the raw East-West gap is due to differences in household income and unemployment status. The conditional East-West gap decreased in the first years after the German reunification and remained quite stable and sizeable since the mid-nineties. The results further indicate that gender differences are small. But the East-West gap is significantly smaller and shows a trend towards convergence for younger birth cohorts.

This paper assesses the long-run toll taken by a large-scale technological disaster on welfare, well-being and mental health. We estimate the causal effect of the 1986 Chernobyl catastrophe after 20 years by linking geographic variation in radioactive fallout to respondents of a nationally representative survey in Ukraine according to their place of residence in 1986. We exclude individuals who were exposed to high levels of radiation—about 4% of the population. Instead, we focus on the remaining majority of Ukrainians who received subclinical radiation doses; we find large and persistent psychological effects of this nuclear disaster. Affected individuals exhibit poorer subjective well-being, higher depression rates and lower subjective survival probabilities; they rely more on governmental transfers as source of subsistence. We estimate the aggregate annual welfare loss at 2–6% of Ukraine's GDP highlighting previously ignored externalities of large-scale catastrophes.

This paper evaluates the effect of an anti-poverty program, Chile Solidario, during its first two years of operation. We find that the program tends to increases significantly their take-up of cash assistance programs and of social programs for housing and employment, and to improve education and health outcomes for participating households. There is no evidence that the participation to employment program translates into improved employment or income outcomes in the short term. Finally, we provide suggestive evidence of the key role that the psycho-social support had in enabling this change, by increasing awareness of social services in the community as well as households’ orientation towards the future., En este estudio se evalúa el efecto de un programa de lucha contra la pobreza, Chile Solidario, durante sus primeros dos años de funcionamiento. Encontramos que el programa tiende a aumentar significativamente su asimilación para los programas de asistencia en efectivo y los programas de vivienda sociales y empleo, así como a mejorar los resultados de la educación y la salud de los hogares participantes. No hay evidencia de que la participación en programas de empleo se traduzca en mejoras en el empleo o los ingresos en el corto plazo. Finalmente, la evidencia sugiere que el apoyo psicosocial ha tenido un rol fundamental en generar este cambio, tanto por medio de aumentar el conocimiento acerca de los servicios sociales en la comunidad como a través de la orientación de los hogares hacia el futuro.

In this article we provide an analytical framework for a collective effort that we label "the well-being transition" away from growth and GDP towards human well-being and offer some insights as to what is needed to accelerate this dynamic, insisting on the need for a new positive narrative and institutional reforms. We first present the achievements and challenges of the well-being transition first by outlying why and how we can go beyond growth and GDP not just to see the world differently but to change it. We then spell out a possible narrative able to engage citizens and transform these new visions into social realities, linking sustainability and justice in a social-ecological approach of 21st century challenges. We finally propose specific institutional reforms to ground the well-being transition in public policy.

This paper builds upon Cunha’s (2015) subjective rationality model in which parents have a subjective belief about the impact of their investment on their children’s early skill formation. We propose that this subjective belief is determined partly by locus of control (LOC), i.e., the extent to which individuals believe that their actions can influence future outcomes. Consistent with the theory, we show that maternal LOC measured at the 12th week of gestation strongly predicts maternal attitudes towards parenting style and actual time investments. We also utilize maternal LOC to improve the specification typically used to estimate skill production function parameters. ispartof: The Economic Journal vol:128 issue:608 pages:298-329 ispartof: location:England status: published

In recent decades the international migration has increased worldwide. The influx of people from different cultures and ethnic groups poses new challenges to the labor market and the welfare state of the host countries and causes changes in the social fabric. In general, immigration benefits the economy of the host country. However, these gains from immigration are unevenly distributed among the native population. Natives who are in direct competition with the new workers expect wage losses and a higher probability of getting unemployed, whereas remaining natives foresee either no feedback effects or even wage gains. On the other hand, the tax and transfer system benefits disproportionally from an influx of highly skilled immigrants. Examinations of 20 European countries in 2010 show that a higher proportion of low-skilled immigrants in the immediate neighborhood of the natives increases the difference in the demand for redistribution between high-skilled and low-skilled natives. Thus, high-skilled natives are more opposed to an expansion of the governmental redistribution. On the one hand, a higher proportion of low-skilled immigrants generates a higher fiscal burden on the welfare state. On the other hand, high-skilled natives' wages increase due to an influx of low-skilled immigrants, since relative supply of high-skilled labor increases. In addition to the economic impact of immigration, the inflow of new citizens is accompanied by natives' fear of changes in the social environment as well as in symbolic values, such as cultural identity or natives' set of values. The latter might generate negative attitudes towards immigrants and increase the demand for a more restrictive immigration policy. On the other hand, more interethnic contact due to a higher ethnic diversity could reduce natives' information gaps, prejudices and stereotypes. This, in turn, could enhance more tolerance and solidarity towards immigrants among natives. Examinations of 18 European countries in 2014 show that more interethnic contact during everyday life reduces both the natives' social distance from immigrants and their fear of social upheaval by the presence of immigrants. However, natives' social distance from immigrants has no effect on their preference for redistribution, but their perceived threat to the national culture and social life by the presence of immigrants has a significantly negative impact on their demand for redistribution. Thus, natives’ concern about the preservation of symbolic norms and values affects the solidarity channel of their redistribution preference. An individual's upward mobility over time or in relation to his or her parents determines his or her attitude towards the welfare state as well as the transfer of his or her opinions to his or her own children. With regard to intergenerational income mobility, Germany shows a value in the international midfield; higher than the United States (lower mobility) and lower than the Scandinavian countries (higher mobility). For example, if a father's lifetime income increases by 10 percent, his son's lifetime income increases by 4.9 percent in the United States and by 3.1 percent in Germany. Additionally, in Germany, fathers' lifetime income tends to show a higher impact on their sons' income if their incomes are higher. In the United States, fathers' lifetime incomes have a stronger influence on their sons' income at the lower and the upper end of the income distribution compared to the middle. Taking a closer look at the intragenerational wage mobility and wage inequality in Germany, the development at the current edge is rather sobering. Since 2000 there is a steady decline in wage mobility. Furthermore, wage mobility in the services sector has been significantly lower than in the manufacturing sector since the beginning of the 2000s. This result is mainly driven by the decrease of wage mobility in the health care and social services sector. Moreover, a worker's unemployment spells and occupation have become more important in the meantime. Since 2006 the increase in the German wage inequality has markedly slowed down and wage growth between 2006 and 2013 has been even polarized, i.e. wages at the lower and at the upper end of the wage distribution have increased more than wages in the middle. However, this development can be partly attributed to the computerization and automation of the production processes. Although, there was substitution of manual routine tasks between 2001 and 2013, cognitive routine tasks are still more pronounced in the middle and at the upper end of the wage distribution. Furthermore, the latter experienced an increase in wage mobility since 2000. On the other hand, manual non-routine tasks are localized disproportionally in the middle and at the lower end of the wage distribution. Thus, the wage gains of these occupations at the lower end were compensated for by the wage losses in the middle., Die internationale Migration hat in den letzten Jahrzehnten weltweit zugenommen. Der Zufluss an Menschen aus anderen Kulturen und Ethnien stellt neue Herausforderungen für den Arbeitsmarkt und den Sozialstaat dar und bewirkt Veränderungen im bestehenden sozialen Gefüge. Für die Wirtschaft des Einwanderungslandes gehen mit der Immigration Wohlfahrtssteigerungen einher, wenn auch diese nicht gleichmäßig über die Einheimischen hinweg verteilt werden. Einheimische, die im direkten Wettbewerb zu den neuen Arbeitnehmern stehen, werden Lohnabschläge und den Verlust des Arbeitsplatzes erwarten, während die Übrigen entweder mit keinen Rückwirkungen oder sogar mit Lohnsteigerungen rechnen. Der Sozialstaat hingegen profitiert, wenn hauptsächlich hochqualifizierte Arbeitnehmer einwandern. Die Untersuchungen für 20 europäische Länder in 2010 zeigen auf, dass der Unterschied in der Nachfrage nach Umverteilung zwischen hoch- und geringqualifizierten Einheimischen größer wird, je größer der Anteil an geringqualifizierten Einwanderern in der unmittelbaren Nachbarschaft ausfällt. Hochqualifizierte Einheimische opponieren stärker gegen eine Ausweitung des Sozialstaats, da zum einen der höhere Anteil an geringqualifizierten Immigranten den Wohlfahrtsstaat stärker belastet und zum anderen die Löhne der Hochqualifizierten aufgrund eines geringeren relativen Arbeitsangebots steigen. Neben den ökonomischen Konsequenzen der Einwanderung, geht mit dem Zufluss an neuen Bürgern auch die Angst vor Umwälzungen in der sozialen Umgebung und vor der Verwässerung bisher geltender Normen- und Wertevorstellungen einher. Letztere können eine Ablehnung von Immigranten seitens der Einheimischen nach sich ziehen und die Forderung nach einer restriktiven Einwanderungspolitik stärken. Andererseits kann der vermehrte Kontakt zu Mitgliedern anderer Ethnien dazu beitragen Informationslücken und Ressentiments abzubauen und im Gegenzug die Toleranz und Solidarität gegenüber Minderheiten stärken. Die Untersuchungen für 18 europäische Länder in 2014 zeigen auf, dass vermehrter interethnischer Kontakt im Alltag sowohl die soziale Distanz der Einheimischen zu Immigranten als auch ihre Ängste vor gesellschaftlichen Umwälzungen senkt. Allerdings schlägt sich die Größe der sozialen Distanz der Einheimischen nicht in ihrer Nachfrage nach Umverteilung nieder, sondern die abstrakten Ängste vor dem Verlust der nationalen Kultur und der Verschlechterung des sozialen Zusammenlebens senken die Präferenz für Umverteilung der Einheimischen. Die Aufstiegschancen eines Bürgers über die Zeit hinweg oder im Vergleich zu den eigenen Eltern bestimmen mitunter seine Einstellung gegenüber dem Sozialstaat sowie die Weitergabe seiner Ansichten an die eigenen Kinder. Bezüglich der intergenerativen Einkommensmobilität befindet sich Deutschland im internationalen Mittelfeld; vor den Vereinigten Staaten (geringere Mobilität) und hinter den skandinavischen Ländern (höhere Mobilität). Fällt beispielsweise das Lebenseinkommen eines Vaters um 10 Prozent höher aus, so ist das Lebenseinkommen seines Sohnes in den Vereinigten Staaten um 4,9 Prozent und in Deutschland um 3,1 Prozent höher. Außerdem zeigt sich in Deutschland tendenziell ein zunehmender Einfluss des väterlichen Einkommens je höher das Einkommen des Sohnes ausfällt. In den Vereinigten Staaten ist der Einfluss des väterlichen Einkommens für Söhne mit geringem und hohem Einkommen höher als für Söhne mit einem mittleren Einkommen. Richtet man den Fokus auf die intragenerative Lohnmobilität und die Lohnungleichheit sind die Entwicklungen am aktuellen Rand eher ernüchternd. Indes wird seit 2000 ein steter Rückgang der Lohnmobilität beobachtet. Auffällig ist, dass seit Beginn der 2000er Jahre die Lohnmobilität im Dienstleistungssektor signifikant kleiner als im Verarbeitenden Gewerbe ausfällt. Dieses Ergebnis ist hauptsächlich von einer sinkenden Lohnmobilität im Gesundheits- und Sozialwesen getrieben. Des Weiteren haben die Dauer der Arbeitslosigkeit und der ausgeübte Beruf eines Arbeitnehmers an Bedeutung gewonnen. Seit 2006 hat der Anstieg der Lohnungleichheit an Geschwindigkeit verloren und das Lohnwachstum zwischen 2006 und 2013 ist sogar polarisiert, d.h. die Löhne der Arbeitnehmer am unteren und am oberen Ende der Lohnverteilung sind relativ zu den Löhnen in der Mitte stärker angestiegen. Diese Entwicklung ist jedoch nur teilweise auf die Computerisierung und die Automatisierung der Produktionsprozesse zurückzuführen. Zwar erfolgte zwischen 2001 und 2013 eine Verdrängung manueller Routinetätigkeiten, aber kognitive Routinetätigkeiten befinden sich weiterhin verstärkt am oberen Ende der Lohnverteilung und erfuhren sogar Zugewinne in ihrer Lohnmobilität. Manuelle nicht-routinemäßige Berufe wiederum befinden sich überproportional häufig am unteren Ende und in der Mitte der Lohnverteilung, so dass die Lohngewinne dieser Berufe am unteren Ende der Lohnverteilung durch die Lohneinbußen in der Mitte kompensiert wurden.

The principal dominance concept for inequality-averse multidimensional social welfare comparisons, commonly known as lower orthant dominance, entails less or equal mass on all lower hyperrectangles of outcomes. Recently, it was shown that bivariate lower orthant dominance can be characterized in terms of two elementary mass transfer operations: diminishing mass transfer (reducing welfare) and correlation-increasing switches (increasing inequality). In this paper we provide a constructive algorithm, which decomposes the mass transfers into such welfare reductions and inequality increases.

Daylight savings time (DST) represents a public good with costs and benefits. We provide the first comprehensive examination of the welfare effects of the spring and autumn transitions for the UK and Germany. Using individual-level data and a regression discontinuity design, we estimate the effect of the transitions on life satisfaction. Our results show that individuals in both the UK and Germany experience deteriorations in life satisfaction in the first week after the spring transition. We find no effect of the autumn transition. We attribute the negative effect of the spring transition to the reduction in the time endowment and the process of adjusting to the disruption in circadian rhythms. The effects are particularly strong for individuals with young children in the household. We conclude that the higher the shadow price of time, the more difficult is adjustment. Presumably, an increase in flexibility to reallocate time could reduce the welfare loss for individuals with binding time constraints.

Over the Great Recession real wages stagnated and unemployment increased. Concurrently, food prices rose sharply, outstripping growth in food expenditure, and leading to a reduction in calories purchased. This has led to concern about rising food poverty. We study British households to assess how they adjusted to changes in the economic environment. We show they switched to cheaper calories; implying food consumption was smoother than expenditure. We use longitudinal data to quantify the way households lowered their per calorie spending, and show they done this in part by increasing shopping effort, and without lowering the nutritional quality of their groceries.

We describe the theory and practice of real GDP comparisons across countries and over time. Effective with version 8, the Penn World Table (PWT) will be taken over by the University of California, Davis and the University of Groningen, with continued input from Alan Heston at the University of Pennsylvania. Version 8 will expand on previous versions of PWT in three respects. First, it will distinguish real GDP on the expenditure side from real GDP on the output side, which differ by the terms of trade faced by countries. Second, it will distinguish growth rates of GDP based on national accounts data from growth rates that are benchmarked in multiple years to cross-country price data. Third, data on capital stocks will be reintroduced. Some illustrative results from PWT version 8 are discussed, including new results that show how the Penn effect is not emergent but a stable relationship over time.

The recent recession has generated a tremendous increase in unemployment rates in Spain. In this paper we use a very rich repeated cross-section dataset on workers’ job conditions, together with regional unemployment rates, to investigate whether peers’ unemployment affects individuals’ job satisfaction. We find that, once perceived job stability is controlled for, peers’ unemployment shows a positive effect on individuals’ wellbeing at work, larger and more precisely estimated for men and private-sector workers. The impact is highly non-linear and the largest effect is found for unemployment rates exceeding 10%. Interestingly, the results are robust to controlling for workforce selection. La recesión reciente ha generado un gran incremento de las tasas de desempleo en España. En este artículo se utiliza una fusión de cortes transversales sobre las condiciones de trabajo, lo que junto a las tasas de desempleo regionales nos permite investigar si el desempleo de los pares afecta a la satisfacción laboral de los individuos. Llegamos a que, una vez controlada la estabilidad en el empleo, el desempleo de los pares muestra un efecto positivo sobre la satisfacción laboral. Este efecto es mayor para los hombres y los trabajadores del sector privado. Además, el impacto es no lineal y el efecto mayor se encuentra para una tasa de desempleo mayor al 10%. Los resultados son robustos y no hay problemas de selección muestral.

The improvement of people’s quality of life is currently considered as the main responsibility of every government. Due to the emergence of knowledge-based economy, it is commonly believed that investments in research and development (R&D) at a given level are a necessary condition for creating growth-based on innovations, thus supporting welfare in developed countries. In this context, the article is devoted to the analysis of influence of R&D expenditures on the quality of life in the European Union countries. As the main measure of the quality of life Human Development Index was utilized. Thus, the article can be considered as a contribution to the discussion on the potential of HDI index for measuring the quality of life in the case of narrow group of relatively developed countries. In the empirical part of the paper, panel data modeling fulfilling the postulates of dynamic estimation was used. The research was done for EU countries for the period 2004–2010. The empirical part takes into consideration the structural diversity between “old” and “new” members of the EU. First of all, the results can be treated as a voice confirming the usefulness of HDI as a measure of quality of life also from the perspective of narrow group of highly developed countries. Then, the research confirms the positive influence of R&D on European welfare only in the case of highly developed “old” member.

Much of the recent welfare analysis in the development literature has focussed attention on poverty. This is especially true for India which has seen a large proliferation in the poverty literature. This study departs from this tradition and focuses on inequality. It is based on the premise that as a country develops and experiences high growth rates, the focus should shift from poverty to inequality. Rising inequality leads to increasing marginalisation and greater social tension even while there may have been a general decline in poverty rates. The study examines the effect of prices on inequality. It does so in the heterogeneous country context of rural India during the recent period of economic reforms and beyond. It proposes a framework for calculating preference based “exact” price indices and shows its usefulness by consistently calculating spatial prices and regionally varying temporal prices that take into account both differences in preferences between states and changing preferences over time. The “exact” price indices are based on the recent “Exact Affine Stone Index” (EASI) demand system. This paper provides evidence on the usefulness of the proposed procedures by finding that the nature of inflation has been regressive during the first half (1999/2000 – 2004/5) and progressive during the second half (2004/5- 2009/10). The study also provides evidence based on panel estimation that suggests that while temporal price inflation has a positive effect on inequality, the effect of spatial prices on inequality is qualitatively quite different. The study also documents the positive role that rural developmental spending can play in reducing inequality. In contrast, an increase in non-farm labour productivity increases inequality. The sharp rise in inequality during the second half of our time period when India recorded high growth rates and falling poverty rates highlights the need for a closer look at inequality and its determinants as in this study.

Purpose– The purpose of this paper is to analyze the different dynamic characteristics of unemployment in a selected group of European Union countries during the current Great Recession, which had unequal consequences on employment depending on the country considered.Design/methodology/approach– The paper follows Shorrocks’s proposal of a duration-sensitive measure of unemployment, and uses cross-sectional data reported by Eurostat coming from European Labour Force Surveys.Findings– The results add some evidence on the relevance of incorporating spells’ duration in measuring unemployment, finding remarkable differences in unemployment patterns in time among European countries.Research limitations/implications– In this paper unemployment is analyzed for all the labor force. Future research should investigate patterns across specific groups such as young people, women, immigrants or the low skilled.Practical implications– It is generally accepted that the negative impact of unemployment on individual welfare can be very different depending on its duration. However, conventional statistics on unemployment do not adequately capture to what extent the recession is not only increasing the incidence of unemployment but also its severity in terms of duration in time of ongoing unemployment spells. The paper shows an easy and practical way to do it in order to improve the understanding of the unemployment phenomenon, using information usually reported by statistical offices.Originality/value– First, the paper provides a tool for dynamic analysis of unemployment based on reported cross-sectional data. Second, the paper demonstrates the empirical relevance of considering spells’ duration when assessing differences in unemployment across countries or in unemployment trends. This is usually neglected or only partially addressed by most conventional measures of unemployment.

Empirical studies of the relative income hypothesis have found both positive and negative effects of relative income on utility. Differences in data and methods make the results difficult to compare. To facilitate comparisons we explore the problem using a large UK household panel. Our findings highlight the sensitivity of the estimated relative income effect to the definition of the reference group and to the estimation strategy employed. Given the increasing attention paid to interdependent preferences in the economics literature, and the implications for problems such as the measurement of societal welfare, our findings are of interest for both the theoretical and empirical study of the relative income hypothesis.

Rising household wealth may potentially impact both total fuel consumption and fuel-type composition, resulting in significant health and environmental implications. Using data from a field experiment in India, we explore the effects of a transfer program that provided poor, rural households with greater levels of assets and cash. Total fuel consumption rose as a result of the transfers. Households shifted from using electricity rather than kerosene as their primary form of light, but total kerosene consumption also rose. In contrast, we did not observe a shift to cleaner cooking fuels.

The European Football Championship (Euro 2012) organized in Poland became the pretext for a number of infrastructural changes. A high level of expenditure makes the Polish event the most expensive among events of this magnitude. The fact that these changes were 100% financed by public funds raises the question of whether these funds were used in a substantiated way. Therefore, the aim of this study is to estimate the willingness-to-pay (WTP) among the community of the Pomeranian region, in connection with the construction of the stadium in Gdansk. A survey conducted among 299 respondents was the source of information. The results of the study show that the average value of WTP for the whole sample was 6.71 EUR2012, while the aggregate value for the whole region was 15.4 million EUR2012. The regression analysis showed that the level of WTP is determined in particular by income levels. The results thus confirm the existence of intangible benefits associated with the constructed facilities. However, it should be noted that the importance of these benefits is insignificant and does not compensate for the massive expenditure from public sources.

This paper constructs a Good Society Index for 45 African countries, termed the Good African Society Index (GASI). The GASI consists of nine main indexes: (1) economic sustainability, (2) democracy and freedom, (3) child well-being, (4) environment and infrastructure, (5) safety and security, (6) health and health systems, (7) integrity and justice, (8) education, and (9) social sustainability and social cohesion. Each component is split into four sub-components for a total of 36 indicators. Tunisia ranks highest on the GASI, followed by Cape Verde and Botswana. Chad has the lowest GASI score, followed by Central African Republic and Cote d’Ivoire. The GASI is strongly related to the 2012 Human Development Index and Fragile States Index, to a lesser extent, GNI per capita.

This issue of Environmental Values brings together some of the key problems in environmental values for the twenty-first century. What is the relationship between humans and Nature, is this changing and if so how; can the potential for domination and exploitation of others be counter-balanced and combated; what should be the role of humans in construction and manipulation of the world around them; does ecological restoration have a credible role; how can the values of male authoritarianism and cold blooded violence to others be countered; why is the evidence of on-going destruction and human-Nature conflict so easily brushed aside; what is the future of conservation and the environmental movement? Dressing the problems up as something they are not has become a strategic marketing exercise for ENGOs, undertaken to avoid scarring those living comfortable material lifestyles who have been numbed into a conformist existence of denial in which their donations buy penitence. As time runs out for more species and habitat and more greenhouse gases accumulate in the upper atmosphere, the main political agenda remains dominated by economic growth and advancing technology. Something substantive is now necessary to break this mould.

The analyses of wealth inequality based on survey data usually suffer from undercoverage of the upper percentiles of the very wealthy. Yet given this group's substantial share of total net worth, it is of particular relevance. As no tax data are available in Germany, the largest fortunes can only be simulated using "rich lists." For example, combining the Forbes list, with its approximately 50 German US dollar billionaires, with survey data results in an increased aggregate total net worth for all households in Germany in 2012 of between one-third and 50 percent, depending on the scenario. Moreover, the share of the richest one percent of the population (about 400,000 households) rises from approximately one-fifth to one-third. After reassessment, the richest ten percent of the population's share of total net worth is estimated to be between 64 and 74 percent, depending on the scenario. These reassessments are characterized by a high degree of uncertainty which eventually can only be reduced by improving the base data.

La presente investigación tiene como objetivo estimar dos índices de desarrollo humano ajustados para Colombia. La estimación se realiza para el periodo 2002-2010 y cubre trece departamentos colombianos, a fin de revelar el efecto que produce tanto la informalidad laboral como la educación media y terciaria en el desarrollo humano. El enfoque y la metodología utilizados son los presentados por el Programa de las Naciones Unidas para el Desarrollo (PNUD), pero incluye una variante en la construcción de los índices de logro educativo y el PIB per cápita. Los resultados evidencian que la informalidad laboral deteriora el desarrollo humano, mientras que una mayor cobertura en educación media y en educación superior ejerce una influencia positiva en los logros medidos a través del índice de desarrollo humano ajustado para Colombia. Lo anterior es fundamental a la hora de establecer recomendaciones de política bajo una perspectiva regional y territorial. This research aims to estimate two adjusted human development indices for Colombia. The estimation is carried out for the period 2002-2010 and covers thirteen Colombian departments in order to disclose the effect produced by both labor informality and secondary and tertiary education on human development. The approach and methodology used is presented by the United Nations Program for Development (UNDP), save for a variation in the construction of educational attainment rates and per capita GDP. Results show that labor informality impairs human development, while greater coverage in secondary education and higher education have a positive influence on achievement as measured by the adjusted human development index for Colombia. This is essential for establishing policy recommendations from a regional and territorial perspective. Cette recherche vise à estimer les indices de développement humain pour treize Départements de Colombie pour la période 2002-2010. L'estimation prétend révéler l'effet du travail informel et de l'éducation secondaire et tertiaire sur l'indice du développement humain. L'approche méthodologique utilisée est celui du Programme des Nations Unies pour le Développement (PNUD), mais nous considérons des variations concernant le calcul du taux de réussite scolaire et du PIB par habitant. Les résultats montrent que l'informalité du travail compromet le développement humain, tandis qu'une plus grande couverture dans l'enseignement aussi bien secondaire que supérieur a une influence positive sur l'indice de développement humain. Ces résultats sont essentiels au moment d'établir des recommandations de politique économique et sociale dans une perspective régionale.

According to calculations based on the Socio-Economic Panel (SOEP) study, average disposable household income rose by five percent in real terms between 2000 and 2012. Only the highest earners have benefited from this development. While real income in the top ten percent rose by more than 15 percent, the earnings of the middle income groups stagnated, and even fell in the lower income groups. As a result, the inequality of disposable household income in Germany climbed sharply up until 2005 and has remained at the same high level ever since. At the same time, the risk of poverty in Germany increased significantly between 2000 and 2009, and is currently at approximately 14 percent. The risk of poverty has risen significantly for young singles (up to the age of 35) in particular. Their at-risk-of-poverty rate increased by 12 percentage points since 2000 to just under 40 percent in 2012. Even being in gainful employment does not necessarily protect them from poverty: in particular, young adults (aged 25 to 35) who are just starting out in their careers are increasingly at risk of poverty.

Der Gesundheitssektor war in den zurückliegenden Jahren durch eine merkliche Beschäftigungszunahme gekennzeichnet. Diese hohe Dynamik wird unter anderem auf die Alterung der Bevölkerung zurückgeführt, da mit zunehmendem Alter die Risiken einer Verschlechterung des Gesundheitszustandes wachsen und damit verbunden die Inanspruchnahme medizinischer, pflegerischer und therapeutischer Leistungen steigt. In diesem Beitrag wird für fünf ausgewählte Europäische Staaten (Dänemark, Deutschland, Italien, Polen und die Slowakei) abgeschätzt, wie sich die künftige Bevölkerungsveränderung auf die Inanspruchnahme von Gesundheitsleistungen und die Nachfrage nach Gesundheitspersonal im kurativen Gesundheitswesen auswirken. Diese demografisch bedingte Änderung der Nachfrage wird der mit einem sektoralen Makromodell vorausgeschätzten Beschäftigungsentwicklung gegenübergestellt. Basis bilden die demografischen und sozio-ökonomischen Szenarien des EU-Forschungsprojektes NEUJOBS sowie die Ergebnisse des NEMESIS Modells. Es zeigt sich, dass in einigen Ländern die Veränderung der Einwohnerzahl einen stärkeren Einfluss auf die Nachfrage nach Gesundheitspersonal hat als die Alterung der Bevölkerung. Ein Vergleich mit der modellierten Beschäftigungsentwicklung deutet in den untersuchten Ländern außer in Polen eher auf eine Verstärkung der Ungleichgewichte durch einen Mangel an Arbeitskräften auf dem Gesundheitsarbeitsmarkt hin. Besonders in Italien werden sich die Ungleichgewichte verstärken. In recent years, the health sector has seen a marked increase in employment. This strong momentum is attributed in part to the ageing population, since as age increases, so does the risk of deteriorating health- and thus the associated demand for medical, nursing, and therapeutic services also rises. In this article, we selected five European countries (Denmark, Germany, Italy, Poland, and Slovakia) and assessed the impact of the future population change on the utilization of health-related services and the demand for health workers in curative health care. We then compared this demographically induced change in demand to a sectorial macro model of anticipated employment development. The bases for this analysis are the demographic and socioeconomic scenarios of the EU research project NEUJOBS, as well as the results of the NEMESIS model. It turns out that in some countries, changes in the total population have a greater influence on the demand for health workers than does the ageing of the population. A comparison with the modeled development of employment indicates a strengthening of the imbalances caused by a shortage of manpower in the health labor market in all countries studied except Poland. In Italy in particular, the imbalances will increase.

The effect of globalization is not only an improvement of living conditions in many developing countries, but also a widening of development disparities and economic inequalities between countries of the rich North and the poor South. Fair trade can be considered as a response to emerging problems of development. Therefore it is a form of assistance directed to the marginalized producers in the Global South by enabling them to manufacture, sell and distribute goods to markets in developed countries. This is an alternative to the existing formula of international trade, whose aim is to help producers in the South by integrating them into the current trading system under certain conditions. The idea is to create a new business relationship between producer and consumer, where the production and consumption are bound together in a new supply chain and where the economic benefits are distributed more fairly. It means that the prices of fair trade products are set at a level that would ensure a steady income to the producer and would lead to raising their living standards and prosperity. The ethical aspects of the fair trade system are clear, the problem is whether the fair trade standards can be used on a wider scale in the global economy, where there is a clash of certain ethical values with market economy rules based on maximizing profits and increasing efficiency.

Cities are one of the most important key in regional development. Creative and innovative cities are considered a competitive pole, by stimulating economic activities and inclusive growth. Those cities which understood the implications for sustainable development are prosperous and competitive at a global level, for example Silicon Valley which is well known as the city were Apple Industry started. The purpose of this paper is to analyze the best practice of creative and innovative cities at global level and extract the most important aspects, which could be applied on Romanian cities. In Romania, there are few cities which may be included in this category, as smart cities. In order to improve the existing literature, this paper aims to explain the benefits of stimulating the cities development and elaborate a list of recommendations for Romanian authorities.

An individual’s attitude about risk underlies economic decisions about the optimal amount of retirement or precautionary savings to set aside, investment in human capital, public or private sector employment, and entrepreneurship, among other things. In the aggregate, these micro-level decisions can influence a country’s growth and development. Although there is a vast literature on measuring risk aversion, estimates of the coefficient of relative risk aversion vary widely—from as low as 0.2 to 10 and higher. Probably the most widely accepted measures lie between 1 and 3. 1 The most common approach to measuring risk aversion is based on a consumption-based capital asset pricing model (CAPM). Hansen and Singleton (1982), using the generalized method of moments (GMM) to estimate a CAPM, report that relative risk aversion is small. Hall (1988) shows that minor changes in the specifi cation and instruments cause the results to vary substantially. Neely, Roy, and Whiteman (2001), in turn, explain this difference, arguing that CAPM-based estimations fail to provide robust results because difficulties in predicting consumption growth and asset returns from available instruments lead to a near identification failure of the model. In this article, we fol low a different approach. We build on the methodology first outlined in Layard, Mayraz, and Nickell (2008). Using happiness data to estimate how fast the marginal utility of income declines as income increases, This article estimates the coefficient of relative risk aversion for 75 countries using data on self- reports of personal well-being from the 2006 Gallup World Poll. The analysis suggests that the coefficient of relative risk aversion varies closely around 1, which corresponds to a logarithmic utility function. The authors conclude that their results support the use of the log utility function in numerical simula tions of economic models. (JEL D80, D31, I31, O57)