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Satisfaction with Life and Economic Well-Being: Evidence from Germany
D'Ambrosio, Conchita | Frick, Joachim R. | Jäntti, Markus
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 129 (2009), Iss. 2 : pp. 283–295
13 Citations (CrossRef)
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Conchita D'Ambrosio, Università degli Studi di Milano-Bicocca – Piazza dell' Ateneo Nuovo, I – 20126, Milano, Italy.
Joachim R. Frick, DIW Berlin, SOEP, 10108 Berlin, Germany.
Markus Jäntti, Abo Akademi University, Tuomiokirkontori 3, FI-20500 Turku, Finland.
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Abstract
The relationship between an individual's economic well-being and satisfaction with own life has been the focus of many studies both within and across countries, in one period of time and over time. As a proxy of economic well-being household income both adjusted and unadjusted for household needs has been generally used. The aim of the present paper is to propose a more comprehensive measure of well-being considering the role that wealth and permanent income play in simultaneously determining satisfaction with life. The results, based on representative microdata from the German Socio-Economic Panel Study (SOEP), suggest that both income and wealth increase satisfaction, that long-run income is more appropriate than short-term income and that satisfaction with life is particularly high for those who are at the top of both the income and wealth distributions.