Dorn, D., Fischer, J. A., Kirchgässner, G., &Sousa-Poza, A. (2007). Is it culture or democracy? The impact of democracy and culture on happiness. Social Indicators Research, 82(3), 505-526.

We analyze the relation between democracy and perceived subjective well-being while controlling for other relevant determinants such as culture measured by languages. We conduct a cross-national analysis covering 28 countries using data from the 1998 International Social Survey Programme. Contrasting existing empirical evidence, we observe a significant positive relationship between democracy and happiness even when …

Hamilton, B. H. (2000). Does entrepreneurship pay? An empirical analysis of the returns to self-employment. Journal of Political economy, 108(3), 604-631.

Possible explanations for earnings differentials in self‐employment and paid employment are investigated. The empirical results suggest that the nonpecuniary benefits of self‐employment are substantial: Most entrepreneurs enter and persist in business despite the fact that they have both lower initial earnings and lower earnings growth than in paid employment, implying a median earnings differential of …

Clark, A. E., &Oswald, A. J. (1996). Satisfaction and comparison income. Journal of public economics, 61(3), 359-381.

This paper attempts to test the hypothesis that utility depends on income relative to a ‘comparison’ or reference level. Using data on 5,000 British workers, it provides two findings. First, workers’ reported satisfaction levels are shown to be inversely related to their comparison wage rates. Second, holding income constant, satisfaction levels are shown to be …

Clark, A. E. (2003). Unemployment as a social norm: Psychological evidence from panel data. Journal of labor economics, 21(2), 323-351.

  This article uses seven waves of panel data to test for social norms in labor market status. The unemployed’s well‐being is shown to be strongly positively correlated with reference group unemployment (at the regional, partner, or household level). This result, far stronger for men, is robust to controls for unobserved individual heterogeneity. Panel data …

Alesina, A., Di Tella, R., &MacCulloch, R. (2004). Inequality and happiness: are Europeans and Americans different?. Journal of Public Economics, 88(9-10), 2009-2042.

  We study the effect of the level of inequality in society on individual well-being using a total of 123,668 answers to a survey question about “happiness”. We find that individuals have a lower tendency to report themselves happy when inequality is high, even after controlling for individual income, a large set of personal characteristics, …

Falk, A., &Knell, M. (2004). Choosing the Joneses: endogenous goals and reference standards. Scandinavian Journal of Economics, 106(3), 417-435.

A growing economic literature stresses the importance of relative comparisons, e.g., for savings and consumption or happiness. In this literature it is usually assumed that reference standards against which people compare themselves are exogenously given. In contrast, findings from social psychology suggest that people play an active role in determining their reference standards. We introduce …

Gerlach, K., &Stephan, G. (1996). A paper on unhappiness and unemployment in Germany. Economics Letters, 52(3), 325-330.

Fixed effects estimations with German data obtain the result that unemployment significantly lowers overall satisfaction with life. The results differ for men and women and are consistent with estimates of labor supply elasticities.   Gerlach, K., &Stephan, G. (1996). A paper on unhappiness and unemployment in Germany. Economics Letters, 52(3), 325-330. https://doi.org/10.1016/S0165-1765(96)00858-0       …

Clark, A., Georgellis, Y., &Sanfey, P. (2001). Scarring: The psychological impact of past unemployment. Economica, 68(270), 221-241.

  This paper considers the psychological impact of past unemployment. Using 11 waves of German panel data, we show that life satisfaction is lower not only for the current unemployed (relative to the employed), but also for those with higher levels of past unemployment. However, the negative wellbeing effect of current unemployment is weaker for …