IDEAS home Printed from https://ideas.repec.org/a/ist/iujepr/v10y2023i2p691-720.html
   My bibliography  Save this article

Veenhoven vs. Easterlin in Happiness Economics: Does Economic Growth Increase Happiness?

Author

Listed:
  • Hatime Kamilcelebi

    (Kirklareli Universitesi, Uygulamalı Bilimler Fakultesi, Finans ve Bankacilik Bolumu, Kirklareli, Turkiye)

Abstract

Richard Easterlin was one of the pioneers of happiness economics studies and stated in his studies that a significant correlation exists between happiness and per capita income. He also explained that, despite the occurrence of an increase in per capita income in the countries he’d studied in his work, no increase had occurred in the stated happiness levels, with the average happiness level in rich countries not being higher than in poor countries. This result is called the Easterlin Paradox in the literature. Ruut Veenhoven was another pioneer of happiness economics and replied to the contradictory results in Easterlin’s study on economic growth and happiness. Veenhoven later criticized the empirical results of Easterlin’s research by using the same data that Easterlin had used and comparing with the results from other studies. Veenhoven (1989) stated an increase in per capita income to increase that country’s happiness levels. As a response to Veenhoven, Easterlin maintained the view that no long-term correlation exists between economic growth and happiness in his scientific studies. However, Veenhoven stated that his studies on the subject so far and the results tested with data from many countries had revealed the opposite. According to Veenhoven, the Easterlin Paradox is an illusion rather than a rule. These discussions from both happiness economics pioneers form the cornerstones of the happiness economics literature. The aim of the study is to examine in detail the works and research of Easterlinand Veenhoven that occurred in response to one another while simultaneously explaining the relationship between economic growth and increase in happiness in countries using the results from their works. When comparing the findings obtained from the data used by both scientists, happiness has been concluded to increase more in poor and developing countries as per capita income increases than in developed countries, although some countries were seen to be exceptions

Suggested Citation

  • Hatime Kamilcelebi, 2023. "Veenhoven vs. Easterlin in Happiness Economics: Does Economic Growth Increase Happiness?," Journal of Economic Policy Researches, Istanbul University, Faculty of Economics, vol. 10(2), pages 691-720, July.
    • Handle: RePEc:ist:iujepr:v:10:y:2023:i:2:p:691-720
    DOI: 10.26650/JEPR1170876
    as

    Download full text from publisher

    File URL: https://cdn.istanbul.edu.tr/file/JTA6CLJ8T5/FBF81CE54CFD4A2993D40078E6C8351E
    Download Restriction: no
    File URL: https://iupress.istanbul.edu.tr/en/journal/jepr/article/mutluluk-iktisadinda-easterline-karsi-veenhoven-iktisadi-buyume-mutlulugu-artirir-mi
    Download Restriction: no
    File URL: https://libkey.io/10.26650/JEPR1170876?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Amos Tversky & Daniel Kahneman, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(4), pages 1039-1061.
    2. Easterlin, Richard A., 1974. "Does Economic Growth Improve the Human Lot? Some Empirical Evidence," MPRA Paper 111773, University Library of Munich, Germany.
    3. Michiel Slag & Martijn J. Burger & Ruut Veenhoven, 2019. "Did the Easterlin Paradox apply in South Korea between 1980 and 2015? A case study," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 66(4), pages 325-351, December.
    4. Angus Deaton, 2008. "Income, Health, and Well-Being around the World: Evidence from the Gallup World Poll," Journal of Economic Perspectives, American Economic Association, vol. 22(2), pages 53-72, Spring.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jan-Emmanuel De Neve & George Ward & Femke De Keulenaer & Bert Van Landeghem & Georgios Kavetsos & Michael I. Norton, 2018. "The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data," The Review of Economics and Statistics, MIT Press, vol. 100(2), pages 362-375, May.
    2. Edsel L. Beja, 2017. "The Asymmetric Effects of Macroeconomic Performance on Happiness: Evidence for the EU," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 52(3), pages 184-190, May.
    3. Tofallis, Chris, 2020. "Which formula for national happiness?," Socio-Economic Planning Sciences, Elsevier, vol. 70(C).
    4. Bruno S. Frey & Anthony Gullo, 2021. "Does Sports Make People Happier, or Do Happy People More Sports?," Journal of Sports Economics, , vol. 22(4), pages 432-458, May.
    5. Easterlin, Richard A. & Angelescu McVey, Laura, 2009. "Happiness and Growth the World Over: Time Series Evidence on the Happiness-Income Paradox," IZA Discussion Papers 4060, Institute of Labor Economics (IZA).
    6. Kapteyn, Arie & Smith, James P. & van Soest, Arthur, 2009. "Life Satisfaction," IZA Discussion Papers 4015, Institute of Labor Economics (IZA).
    7. Stefano Bartolini & Francesco Sarracino, 2014. "It's not the economy, stupid! How social capital and GDP relate to happiness over time," Papers 1411.2138, arXiv.org.
    8. BARTOLINI Stefano & SARRACINO Francesco, 2011. "Happy for How Long? How Social Capital and GDP relate to Happiness over Time," LISER Working Paper Series 2011-60, Luxembourg Institute of Socio-Economic Research (LISER).
    9. Tufan Ekici & Selda Koydemir, 2016. "Income Expectations and Happiness: Evidence from British Panel Data," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 11(2), pages 539-552, June.
    10. Proto, Eugenio & Rustichini, Aldo, 2015. "Life satisfaction, income and personality," Journal of Economic Psychology, Elsevier, vol. 48(C), pages 17-32.
    11. Layard, Richard & Mayraz, Guy & Nickell, Stephen, 2009. "Does relative income matter? Are the critics right?," LSE Research Online Documents on Economics 28594, London School of Economics and Political Science, LSE Library.
    12. Shizuki Fukuda & Michio Murakami & Keigo Noda & Taikan Oki, 2016. "How Achieving the Millennium Development Goals Increases Subjective Well-Being in Developing Nations," Sustainability, MDPI, vol. 8(2), pages 1-19, February.
    13. Joanne Haddad & Jad Chaaban & Ali Chalak & Hala Ghattas, 2022. "Does Income Class Affect Life Satisfaction? New Evidence from Cross-Country Microdata," Social Sciences, MDPI, vol. 11(6), pages 1-23, June.
    14. Beja Jr, Edsel, 2013. "Does economic prosperity bring about a happier society? Mathematical remarks on the Easterlin Paradox debate," MPRA Paper 48229, University Library of Munich, Germany.
    15. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.
    16. Zhang, Yinjunjie & Xu, Zhicheng Phil & Palma, Marco A., 2017. "Misclassification Errors of Subjective Well-being: A New Approach to Mapping Happiness," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258553, Agricultural and Applied Economics Association.
    17. Barrington-Leigh, C.P., 2024. "The econometrics of happiness: Are we underestimating the returns to education and income?," Journal of Public Economics, Elsevier, vol. 230(C).
    18. Opfinger, Matthias & Gundlach, Erich, 2011. "Religiosity as a determinant of happiness," Open Access Publications from Kiel Institute for the World Economy 48360, Kiel Institute for the World Economy (IfW Kiel).
    19. Blanchflower, David G. & Oswald, Andrew J., 2011. "Antidepressants and Age," IZA Discussion Papers 5785, Institute of Labor Economics (IZA).
    20. Ahrens, Steffen & Snower, Dennis J., 2014. "Envy, guilt, and the Phillips curve," Journal of Economic Behavior & Organization, Elsevier, vol. 99(C), pages 69-84.

    More about this item

    Keywords

    Happiness economics; economic growth; GDP; Easterlin Paradox; Easterlin Illusion JEL Classification : I31 ; O40 ; O47;
    All these keywords.

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ist:iujepr:v:10:y:2023:i:2:p:691-720. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ertugrul YASAR (email available below). General contact details of provider: https://edirc.repec.org/data/ifisttr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.