Subjective Economic Well-Being in Eastern Europe
University of Essen, Economics Department, Working Paper No. 120
27 Pages Posted: 20 Mar 2002
Date Written: February 2002
This paper analyses subjective economic well-being in several Eastern European countries from 1991 to 1995. Economic well-being explains a significant part of the variation in overall life satisfaction of Eastern Europeans. In an ordered logit model, the determinants of subjective economic well-being are analysed. Some results are very similar to typical findings in happiness regressions, such as a negative but u-shaped age effect, positive influences of education and relative income position, as well as a negative effect of unemployment. Differing results were found with regard to gender and marital status. Finally, comparing indicators of objective and subjective well-being on a macro level indicates that using a standard macro variable for cross-country comparisons in well-being, such as real GDP per capita, may provide misleading results during the early stages of transformation.
Keywords: Eastern Europe, Economic Well-being, Happiness, Economic Transformation
JEL Classification: D31, D60, I31, O52, P2
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