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Satisfaction and comparison income in transition and developed economies

Author

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  • Devrim Dumludag
Abstract
The main purpose of this paper is to evaluate the impact of different types of income comparison on subjective well-being in transition countries and developed European countries. The paper relies on the Life in Transition Survey (European Bank for Reconstruction and Development 2011 ), which was conducted in late 2010 jointly by the European Bank for Reconstruction and Development and the World Bank. The emphasis of the paper is on income comparisons, specifically; local comparisons and self-ranking. The main findings reveal that comparisons have a significant impact on life satisfaction in transition countries, whereas the relationship between comparison and life satisfaction is ambiguous in developed European countries. In transition countries, the impact of comparisons is asymmetric: in most cases, under-performing one’s benchmark has a greater effect than out-performing it. In transition countries, both downward and upward evaluations have an impact on life satisfaction, while it is worthy of note that all upward evaluations have no effect on life satisfaction in developed European countries. Copyright Springer-Verlag Berlin Heidelberg 2014

Suggested Citation

  • Devrim Dumludag, 2014. "Satisfaction and comparison income in transition and developed economies," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 61(2), pages 127-152, June.
    • Handle: RePEc:spr:inrvec:v:61:y:2014:i:2:p:127-152
    DOI: 10.1007/s12232-014-0201-0
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    References listed on IDEAS

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    Cited by:

    1. Han Yu, 2020. "Income Comparison and Subjective Well-Being: Evidence from Self-Perceived Relative Income Data from China," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 46(4), pages 636-672, October.
    2. Han Yu, 2019. "The Impact of Self‐Perceived Relative Income on Life Satisfaction: Evidence from British Panel Data," Southern Economic Journal, John Wiley & Sons, vol. 86(2), pages 726-745, October.

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    More about this item

    Keywords

    Life satisfaction; Transition countries; Economic development; Income comparisons ; O1; D00; D6; Z00;
    All these keywords.

    JEL classification:

    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • D00 - Microeconomics - - General - - - General
    • D6 - Microeconomics - - Welfare Economics
    • Z00 - Other Special Topics - - General - - - General

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