Happiness over the life cycle: exploring age-specific preferences

Existing evidence suggests a U-shaped relationship between age and life satisfaction, when controlling for income and education and other personal characteristics. On the other hand, there is no clear pattern between old age and happiness without the use of controls. Thus, it is not ageing as such, which results declining happiness, but rather the circumstances which are associated with ageing. Which of these circumstances could be averted? Are the preferences of the elderly are similar to others? The paper aims to explore these issues, using the European Social Survey. The results imply that the varying level of life satisfaction during the life cycle may be explained partly by changing preferences (by the decreasing importance of work, the increasing importance of religion, and the declining disutility of being single), and partly by changing circumstances. While changing preferences seem to increase well-being, changing circumstances seem to decrease it. Exceptions are the few positive changes in circumstances, which are likely to contribute to higher well-being, include increasing religiosity and relatively low pensioners’ poverty across the 21 European countries examined here. Old days thus are happy above all due to changing priorities in life.