Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/104640
Authors: 
Brown, Sarah
Gray, Daniel
Year of Publication: 
2014
Series/Report no.: 
IZA Discussion Papers 8530
Abstract: 
This paper explores the importance of the household's financial position for an individual's level of well-being. Initially, the empirical analysis, based on a large nationally representative panel survey, aims to ascertain the impact of the household's monetary financial position on overall life satisfaction and financial well-being, with the latter being measured by financial satisfaction and subjective prosperity. Taking into account monetary factors in addition to income, the results indicate that the household's level of net wealth, assets and debt are important determinants of overall life satisfaction and financial well-being. The paper also explores whether the financial situation of households in a comparison group influences an individual's overall life satisfaction and financial well-being. The results suggest that the financial position of households in the comparison group is an important determinant of an individual's level of overall life satisfaction and financial well-being, with information effects generally dominating comparison effects. In addition, the effects of the comparison group are asymmetric depending on whether a household's financial position is above or below the average of the reference group and vary over the life-cycle.
Subjects: 
financial satisfaction
fixed effects ordered logit
household finances
overall life satisfaction
subjective prosperity
JEL: 
D14
I31
J28
Document Type: 
Working Paper

Files in This Item:
File
Size
355.86 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.