Does Transition Make You Happy?

Abstract

This paper analyzes life satisfaction in transition countries using evidence from the World Values Survey. The paper demonstrates that individuals in transition economies on average record lower values of self-reported satisfaction with life compared with those in non-transition countries. An econometric analysis shows that females, people with higher levels of education and higher incomes are happier, and happiness declines with age until the early-fifties. Self-employed people in transition countries show a higher level of satisfaction relative to full-time employees, in contrast to evidence from non-transition countries. A comparison across time for a smaller sample of countries shows that life satisfaction levels have returned close to pre-transition levels in most cases, after a dip in the mid-1990s. In addition, satisfaction levels are highest in those countries where market-oriented reforms are most advanced and where inequality is lower.

Keywords: Happiness, transition, reforms

JEL Classification: D10, O53, P20