IDEAS home Printed from https://ideas.repec.org/p/diw/diwsop/diw_sp16.html
   My bibliography  Save this paper

Are Regional Differences in Utility Eliminated over Time?: Evidence from Germany

Author

Listed:
  • David Maddison
  • Katrin Rehdanz

Abstract

Hedonic theory assumes that changes in land prices and wage rates eliminate the utility advantages of differing locations. Using happiness data from the German socio-economic panel this paper empirically tests whether regional utility differences exist and if so whether utility levels show any tendency to converge over time. Empirical analysis reveals substantial differences in utility over different regions of Germany. Analysing a panel of data indicates that even if individual utility levels are at any one moment in disequilibrium they are rapidly converging over Germany for all types of individuals.

Suggested Citation

  • David Maddison & Katrin Rehdanz, 2007. "Are Regional Differences in Utility Eliminated over Time?: Evidence from Germany," SOEPpapers on Multidisciplinary Panel Data Research 16, DIW Berlin, The German Socio-Economic Panel (SOEP).
    • Handle: RePEc:diw:diwsop:diw_sp16
    as

    Download full text from publisher

    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.57332.de/diw_sp0016.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bruno S. Frey & Alois Stutzer, 2002. "What Can Economists Learn from Happiness Research?," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 402-435, June.
    2. Easterlin, Richard A, 2001. "Income and Happiness: Towards an Unified Theory," Economic Journal, Royal Economic Society, vol. 111(473), pages 465-484, July.
    3. Robert J. MacCulloch & Rafael Di Tella & Andrew J. Oswald, 2001. "Preferences over Inflation and Unemployment: Evidence from Surveys of Happiness," American Economic Review, American Economic Association, vol. 91(1), pages 335-341, March.
    4. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    5. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    6. Jennifer Hunt, 2000. "Why Do People Still Live in East Germany?," NBER Working Papers 7564, National Bureau of Economic Research, Inc.
    7. Jennifer Hunt, 2004. "Are migrants more skilled than non-migrants? Repeat, return, and same-employer migrants," Canadian Journal of Economics, Canadian Economics Association, vol. 37(4), pages 830-849, November.
    8. Gyourko, Joseph & Tracy, Joseph, 1989. "The Importance of Local Fiscal Conditions in Analyzing Local Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1208-1231, October.
    9. Paul Frijters & John P. Haisken-DeNew & Michael A. Shields, 2004. "Money Does Matter! Evidence from Increasing Real Income and Life Satisfaction in East Germany Following Reunification," American Economic Review, American Economic Association, vol. 94(3), pages 730-740, June.
    10. Greenwood, Michael J. & Hunt, Gary L., 1989. "Jobs versus amenities in the analysis of metropolitan migration," Journal of Urban Economics, Elsevier, vol. 25(1), pages 1-16, January.
    11. Franz-Josef Kemper, 2004. "Internal Migration in Eastern and Western Germany: Convergence or Divergence of Spatial Trends after Unification?," Regional Studies, Taylor & Francis Journals, vol. 38(6), pages 659-678.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Johannes Vatter, 2012. "Well-Being in Germany: What Explains the Regional Variation?," SOEPpapers on Multidisciplinary Panel Data Research 435, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Frank Goetzke & Tilmann Rave, 2013. "Migration in Germany," International Regional Science Review, , vol. 36(2), pages 167-182, April.
    3. Johannes Vatter, 2012. "Well-Being in Germany: GDP and Unemployment Still Matter," RatSWD Working Papers 196, German Data Forum (RatSWD).
    4. Ahmadiani, Mona & Ferreira, Susana, 2019. "Environmental amenities and quality of life across the United States," Ecological Economics, Elsevier, vol. 164(C), pages 1-1.
    5. Vatter, Johannes, 2012. "Well-being in Germany: What explains the regional variation?," FZG Discussion Papers 50, University of Freiburg, Research Center for Generational Contracts (FZG).

    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. David J. Maddison & Katrin Rehdanz, 2007. "Happiness Over Space And Time," Working Papers FNU-128, Research unit Sustainability and Global Change, Hamburg University, revised Feb 2007.
    2. Brereton, Finbarr & Clinch, J. Peter & Ferreira, Susana, 2008. "Happiness, geography and the environment," Ecological Economics, Elsevier, vol. 65(2), pages 386-396, April.
    3. Rehdanz, Katrin & Maddison, David, 2005. "Climate and happiness," Ecological Economics, Elsevier, vol. 52(1), pages 111-125, January.
      • Katrin Rehdanz & David J. Maddison, 2003. "Climate and Happiness," Working Papers FNU-20, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003.
    4. Simon Luechinger, 2009. "Valuing Air Quality Using the Life Satisfaction Approach," Economic Journal, Royal Economic Society, vol. 119(536), pages 482-515, March.
    5. Moro, Mirko & Brereton, Finbarr & Ferreira, Susana & Clinch, J. Peter, 2008. "Ranking quality of life using subjective well-being data," Ecological Economics, Elsevier, vol. 65(3), pages 448-460, April.
    6. Frijters, Paul & Beatton, Tony, 2012. "The mystery of the U-shaped relationship between happiness and age," Journal of Economic Behavior & Organization, Elsevier, vol. 82(2), pages 525-542.
    7. Marcel Fafchamps & Forhad Shilpi & The World Bank, 2004. "Isolation and Subjective Welfare," Economics Series Working Papers 216, University of Oxford, Department of Economics.
    8. Rehdanz, Katrin & Maddison, David, 2008. "Local environmental quality and life-satisfaction in Germany," Ecological Economics, Elsevier, vol. 64(4), pages 787-797, February.
    9. David G. Blanchflower & Andrew J. Oswald, 2004. "Money, Sex and Happiness: An Empirical Study," Scandinavian Journal of Economics, Wiley Blackwell, vol. 106(3), pages 393-415, October.
    10. Bruno S. Frey & Simon Luechinger & Alois Stutzer, "undated". "Valuing Public Goods: The Life Satisfaction Approach," IEW - Working Papers 184, Institute for Empirical Research in Economics - University of Zurich.
    11. Roberta Distante, 2013. "Subjective Well-Being, Income and Relative Concerns in the UK," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 113(1), pages 81-105, August.
    12. Andrew E. Clark & Paul Frijters & Michael A. Shields, 2006. "Income and happiness: Evidence, explanations and economic implications," PSE Working Papers halshs-00590436, HAL.
    13. de New, John & Sinning, Mathias, 2007. "Social Deprivation and Exclusion of Immigrants in Germany," IZA Discussion Papers 3153, Institute of Labor Economics (IZA).
    14. Byela Tibesigwa & Martine Visser & Brennan Hodkinson, 2016. "Effects of Objective and Subjective Income Comparisons on Subjective Wellbeing," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 128(1), pages 361-389, August.
    15. John Carruthers & Gordon F. Mulligan, 2012. "The plane of living and the precrisis evolution of housing values in the USA," Journal of Economic Geography, Oxford University Press, vol. 12(4), pages 739-773, July.
    16. Ferrer-i-Carbonell, Ada & Gowdy, John M., 2007. "Environmental degradation and happiness," Ecological Economics, Elsevier, vol. 60(3), pages 509-516, January.
    17. Carlos Medina & Leonardo Morales & Jairo Nuñez, 2008. "Quality of Life in Urban Neighborhoods in Colombia: The Cases of Bogotá and Medellín," Borradores de Economia 536, Banco de la Republica de Colombia.
    18. Becchetti, Leonardo & Rossetti, Fiammetta, 2009. "When money does not buy happiness: The case of "frustrated achievers"," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(1), pages 159-167, January.
    19. Ada Ferrer-i-Carbonell & Klarita Gërxhani, 2011. "Financial Satisfaction and (in)formal Sector in a Transition Country," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 102(2), pages 315-331, June.
    20. Emmanouil Mentzakis, 2011. "Allowing for heterogeneity in monetary subjective well‐being valuations," Health Economics, John Wiley & Sons, Ltd., vol. 20(3), pages 331-347, March.

    More about this item

    Keywords

    Convergence; Hedonic Analysis; Happiness; Migration; Germany;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Lists

    This item is featured on the following reading lists, Wikipedia, or ReplicationWiki pages:
    1. SOEP based publications

    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:diw:diwsop:diw_sp16. 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: Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/sodiwde.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.