According to international comparisons the Hungarians are extremely dissatisfied with their lives. Meanwhile Austria, with many cultural and historical similarities to Hungary, is in the forefront of the satisfaction lists. We have identified some of the important causes of Hungarian dissatisfaction and the possible ways of its improvement, estimating the effect of the factors influencing subjective well-being on Hungarian and Austrian household level data. The most important factor in diminishing satisfaction is bad health status, and the best way to increase it is education. However in Hungary, unlike Austria, neither vocational training, nor upper secondary education increase satisfaction, only tertiary education has such effect. Increasing the share of tertiary education enrolment could increase life satisfaction in Hungary. In contrast to the stereotypes, the satisfaction increasing effect of social connections is much stronger in Austria than in Hungary. This holds for the relationships and for the contacts with relatives and friends alike. In Hungary the intensity of satisfaction-increasing social relations is relatively low. Contacts with relatives and friends increase satisfaction more as factors improving the security of sustenance than in their intrinsic merits. Unemployment decreases satisfaction above income effect and this decrease spreads also to the family members. This is caused mainly by the insecurity of housing. In Austria the well-developed residential tenancy system prevents this effect. To build up such a system in Hungary could improve life satisfaction. Specifying previous findings of other authors we came to the conclusion that the higher satisfaction level of entrepreneurs is the result of hidden income.
subjective well-being self-rated health satisfaction