Dataset Information

The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data.

ABSTRACT: Are individuals more sensitive to losses than gains in terms of economic growth? We find that measures of subjective well-being are more than twice as sensitive to negative as compared to positive economic growth. We use Gallup World Poll data from over 150 countries, BRFSS data on 2.3 million US respondents, and Eurobarometer data that cover multiple business cycles over four decades. This research provides a new perspective on the welfare cost of business cycles, with implications for growth policy and the nature of the long-run relationship between GDP and subjective well-being.

SUBMITTER: De Neve JE

PROVIDER: S-EPMC5972831 | biostudies-literature | 2018 May

REPOSITORIES: biostudies-literature

ACCESS DATA

Publications

The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data.

De Neve Jan-Emmanuel JE Ward George G De Keulenaer Femke F Van Landeghem Bert B Kavetsos Georgios G Norton Michael I MI

The review of economics and statistics 20180504 2

Are individuals more sensitive to losses than gains in terms of economic growth? We find that measures of subjective well-being are more than twice as sensitive to negative as compared to positive economic growth. We use Gallup World Poll data from over 150 countries, BRFSS data on 2.3 million US respondents, and Eurobarometer data that cover multiple business cycles over four decades. This research provides a new perspective on the welfare cost of business cycles, with implications for growth p ...[more]

PMID: 29861510

Similar Datasets

Project description:Social scientists have postulated that the discrepancy between achievements and expectations affects individuals' subjective well-being. Still, little has been done to qualify and quantify such a psychological effect. Our empirical analysis assesses the consequences of positive and negative affective forecasting errors-the difference between realized and expected subjective well-being-on the subsequent level of subjective well-being.We use longitudinal data on a representative sample of 13,431 individuals from the German Socio-Economic Panel. In our sample, 52% of individuals are females, average age is 43 years, average years of education is 11.4 and 27% of our sample lives in East Germany. Subjective well-being (measured by self-reported life satisfaction) is assessed on a 0-10 discrete scale and its sample average is equal to 6.75 points.We develop a simple theoretical framework to assess the consequences of positive and negative affective forecasting errors-the difference between realized and expected subjective well-being-on the subsequent level of subjective well-being, properly accounting for the endogenous adjustment of expectations to positive and negative affective forecasting errors, and use it to derive testable predictions. Given the theoretical framework, we estimate two panel-data equations, the first depicting the association between positive and negative affective forecasting errors and the successive level of subjective well-being and the second describing the correlation between subjective well-being expectations for the future and hedonic failures and successes. Our models control for individual fixed effects and a large battery of time-varying demographic characteristics, health and socio-economic status.While surpassing expectations is uncorrelated with subjective well-being, failing to match expectations is negatively associated with subsequent realizations of subjective well-being. Expectations are positively (negatively) correlated to positive (negative) forecasting errors. We speculate that in the first case the positive adjustment in expectations is strong enough to cancel out the potential positive effects on subjective well-being of beaten expectations, while in the second case it is not, and individuals persistently bear the negative emotional consequences of not achieving expectations.

Dataset Information

The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data.

Publications

The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data.

Similar Datasets

OmicsDI is part of the ELIXIR infrastructure

Tweets