Friday, February 20, 2009

Well-being: Income and Social Context

From a new study published by the NBER :

We find strong evidence for the importance of both income and social context variables 

in explaining differences in well-being. For most specifications tested, the combined 

effects of a few measures of the social and institutional context exceed that of income in 

equations explaining international differences in life satisfaction. Calculation of 

compensating differentials also reveals large income-equivalent values for improvements 

in the social context, with much of this value flowing via positive national spillover 

effects for key social variables.

Improvements in factors such as corruption, freedom, friends to count on, care and helping others, importance of religion can go a long way in improving human well-being.

No comments: