Poverty is a Public Bad: Panel Evidence from Subjective Well-Being Data

16 Pages Posted: 21 Feb 2017

See all articles by Heinz Welsch

Heinz Welsch

University of Oldenburg; ZenTra - Center for Transnational Studies

Philipp Biermann

University of Oldenburg - Economic Theory

Multiple version iconThere are 2 versions of this paper

Date Written: December 2016

Abstract

Previous research has found that subjective well-being (SWB) is lower for individuals classified as being in poverty. Using panel data for 39,239 individuals living in Germany from 2005-2013, we show that people’s SWB is negatively correlated with the state-level poverty ratio while controlling for individual poverty status and poverty intensity. The negative relationship between aggregate poverty and SWB is more salient in the upper segments of the income distribution and is robust to controlling for the rate of unemployment and per capita GDP. The character of poverty as a public bad suggests that poverty alleviation is a matter not only of equity, but of efficiency.

Keywords: poverty; poverty ratio; subjective well-being; public bad; life satisfaction

JEL Classification: I31; I32; D60

Suggested Citation

Welsch, Heinz and Biermann, Philipp, Poverty is a Public Bad: Panel Evidence from Subjective Well-Being Data (December 2016). SOEPpaper No. 885. Available at SSRN: https://ssrn.com/abstract=2920612 or http://dx.doi.org/10.2139/ssrn.2920612

Heinz Welsch (Contact Author)

University of Oldenburg ( email )

Ammerländer Heerstraße 114-118
Oldenburg, DE D-26111
Germany

ZenTra - Center for Transnational Studies ( email )

Ammerländer Heerstraße 138
Oldenburg, 26131
Germany

Philipp Biermann

University of Oldenburg - Economic Theory ( email )

Germany
+49 441 798-4852 (Phone)
+49 441 798-194852 (Fax)

HOME PAGE: http://www.uni-oldenburg.de/wire/vwl/wt/philipp-biermann-ma/

Register to save articles to
your library

Register

Paper statistics

Downloads
14
Abstract Views
194
PlumX Metrics