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I can't smile without you: Spousal correlation in life satisfaction

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  • Powdthavee, Nattavudh

Abstract

This paper tests whether one partner's happiness significantly influences the happiness of the other partner. Using 10 waves of the British Household Panel Survey, it utilizes a panel-based GMM methodology to estimate a dynamic model of life satisfaction. The use of the GMM-system estimator corrects for correlated effects of partner's life satisfaction and solves the problem of measurement error bias. The results show that, for both genders, there is a positive and statistically significant spillover effect of life satisfaction that runs from one partner to the other partner in a couple. The positive bias on the estimated spillover effect coming from assortative mating and shared social environment at cross-section is almost offset by the negative bias coming from systematic measurement errors in the way people report their life satisfaction. Moreover, consistent with the spillover effect model, couple dissolution at t + 1 is negatively correlated with partners' life satisfaction at t.

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  • Powdthavee, Nattavudh, 2009. "I can't smile without you: Spousal correlation in life satisfaction," Journal of Economic Psychology, Elsevier, vol. 30(4), pages 675-689, August.
    • Handle: RePEc:eee:joepsy:v:30:y:2009:i:4:p:675-689
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    More about this item

    Keywords

    Life satisfaction Assortative mating Spillover Marriage Happiness GMM;

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • I0 - Health, Education, and Welfare - - General

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