Lost in Transition: Life Satisfaction on the Road to Capitalism

45 Pages Posted: 23 May 2008

See all articles by Richard A. Easterlin

Richard A. Easterlin

University of Southern California - Department of Economics; IZA Institute of Labor Economics

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Abstract

In the transition from socialism to capitalism in Eastern Europe life satisfaction has followed the V-shaped pattern of GDP but failed to recover commensurately. In general, increased satisfaction with material living levels has occurred at the expense of decreased satisfaction with work, health, and family life. Disparities in life satisfaction have increased markedly with those hardest hit being the less educated and persons over age 30; women and men have suffered about equally. The asymmetric response of life satisfaction to decreases in GDP in transition countries and increases in GDP in non-transition countries is arguably due to loss aversion.

Keywords: happiness, transition, capitalism, socialism, loss aversion

JEL Classification: I31, P5, P27, D60

Suggested Citation

Easterlin, Richard A., Lost in Transition: Life Satisfaction on the Road to Capitalism. , Vol. , pp. -, . Available at SSRN: https://ssrn.com/abstract=1136214 or http://dx.doi.org/10.1111/j.0042-7092.2007.00700.x

Richard A. Easterlin (Contact Author)

University of Southern California - Department of Economics ( email )

3620 South Vermont Ave. Kaprielian (KAP) Hall, 300
Los Angeles, CA 90089
United States

IZA Institute of Labor Economics

Schaumburg-Lippe-Str. 7 / 9
Bonn, D-53072
Germany

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