Using self reported measures of life satisfaction and risk attitudes, we empirically test whether there is a relationship between individuals inequality and risk aversion. The empirical analysis uses the German SOEP household panel for the years 1997 to 2007 to conclude that the negative effect...

People gain utility from occupying a higher ranked position in the income distribution of the reference group. This paper investigates whether these gains depend on an individual's set of non-cognitive skills. Using the 2000-2008 waves of the German Socioeconomic Panel dataset (SOEP), a...

In this paper we attempt to explain individual, ordinally comparable,satisfaction levels. We postulate a simultaneous equation model where general satisfaction isexplained by exogenous shock and level variables, and by the values of the satisfactionswith respect to six distinct endogenous...

Psychologists and sociologists usually interpret answers to happiness surveys as cardinal and comparableacross respondents (Kahneman et al. 1999). As a result, these social scientists run OLS regressionson happiness and changes in happiness. Economists, on the other hand, usually only assume...

This paper proposes a method to evaluate health losses or gains by looking at the impact on well-being of a change in health status. The paper presents estimates of the equivalent income change that would be necessary to change general satisfaction with life to the same extent as a change in...

In this paper, the concept of Income Satisfaction Inequality is operationalized on the basis of individual responses to an Income Satisfaction question posed in the German Socio-Economic Panel (GSOEP). Income satisfaction is the subjective analogue of the objective income concept and includes...

In this paper we propose an alternative approach to the estimation of ordered response models. We show that the Probit-method may be replaced by a simple OLS-approach, called P(robit)OLS, without any loss of efficiency. This method can be generalized to the analysis of panel data. For...