Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/56131
Authors: 
Fischer, Justina A. V.
Year of Publication: 
2008
Series/Report no.: 
SSE/EFI Working Paper Series in Economics and Finance 697
Abstract: 
Empirical research on the role of economic institutions for subjective well-being is still widely lacking, while recent economic-experimental outcomes suggest that experienced utility may depend on the intensity of market competition. This paper is the first to empirically analyze the implication of market competition for subjective well-being using real-life survey data on 80,000 individuals in more than 60 countries from the World Values Survey 1997-2001. In support of our hypothesis, we find that market competition aggravates the impact of individual's bargaining position in economic transactions on her subjective well-being - compared to the least powerful in society. Put differently, we find that market competition enlarges the happiness differences caused by cleavages in socio-economic position. Our results also suggest that competition induced welfare changes are not gender-specific, while a stronger rule of law appears to prevent the generation of such additional benefits or losses. Particularly the latter results call for further economic-experimental corroboration in the laboratory, but also bear important policy implications.
Subjects: 
Subjective well-being
happiness
utility
competition
rule of law
completeness of contract
laboratory experiment
World Values Survey
JEL: 
C99
D02
D40
I31
Document Type: 
Working Paper

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