Publications Based on SOEP Data: SOEPlit

Testing Theories of Happiness

Latter-day researches based on reported subjective well-being have improved the understanding of utility. The concept of utility has acquired a psychological content, and has proved to be operational in researches on income, unemployment, inflation, inequality, and democratic institutions in their relations with happiness. The authors plead for fostering happiness researches, and give examples in which ...

Economic Consequences of Mispredicting Utility

In a simple conceptual framework, we organize a multitude of phenomena related to the (mis)prediction of utility. Consequences in terms of distorted choices and lower well-being emerge if people have to trade-off between alternatives that are characterized by attributes satisfying extrinsic desires and alternatives serving intrinsic needs. Thereby the neglect of asymmetries in adaptation is proposed ...

Household composition and Savings: An Empirical Analysis based on the German SOEP data

Income Distribution in East Germany in the First Five Years after the Fall of the Wall

Living Standards in Retirement: Accepted International Comparisons are Misleading

Accepted international assessments of living standards in retirement rely on comparing social pension incomes. These assessments conclude that European countries with contributory pension schemes provide retirees with higher living standards than liberal Anglo-American regimes in which many citizens rely on flat rate old age pensions. Comparisons based solely on pension incomes are potentially misleading ...

The Cross-National Equivalent File (CNEF) and its Member Country Household Panel Studies

Age, Life-Satisfaction, and Relative Income: Insights from the UK and Germany

We first confirm previous results with the German Socio-Economic Panel by Layard et al. (2010), and obtain strong negative effects of comparison income. However, when we split the sample by age, we find quite different results for reference income. The effects on lifesatisfaction are positive and significant for those under 45, consistent with Hirschman’s (1973) ‘tunnel effect’, and only negative (and ...

So Far so Good: Age, Happiness, and Relative Income

In a simple 2-period model of relative income under uncertainty, higher comparison income for the younger cohort can signal higher or lower expected lifetime relative income, and hence either increase or decrease well-being. With data from the German Socio-Economic Panel and the British Household Panel Survey, we first confirm the standard negative effects of comparison income on life satisfaction ...

Testing the tunnel effect: comparison, age and happiness in UK and German panels

In contrast to previous results combining all ages we find positive effects of comparison income on happiness for the under 45s, and negative effects for those over 45. In the BHPS these coefficients are several times the magnitude of own income effects. In GSOEP they cancel to give no effect of effect of comparison income on life satisfaction in the whole sample, when controlling for fixed effects, ...

Testing for State Dependence Effects in a Dynamic Model of Male Unemployment Behaviour