How important is Methodology for the Estimates of the Determinants of Happiness?

Arbeitspapier

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 ordinalcomparability and have mainly used ordered latent response models. As a consequence, economists haveby and large not taken satisfactory account of fixed individual traits. We address this latter problemby developing a conditional estimator for the fixed-effect ordered logit model. The empirical findingspresented show that it makes virtually no difference whether one assumes ordinality or cardinality ofhappiness answers, whilst allowing for fixed-effects does change results substantially. This leads us toadvocate allowing for and endogenising the persistent personality traits that make up these fixed-effects.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 02-024/3

Classification and Topics

• Classification: Wirtschaft ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models ; Single Equation Models; Single Variables: Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities ; General Welfare; Well-Being
• Subject: Fixed effects ; happiness methodology ; unobservables ; latent variabIe models ; Lebensqualität ; Schätzung ; Logit-Modell

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ferrer-i-Carbonell, Ada ; Frijters, Paul
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2002

Further information

• Handle: http://hdl.handle.net/10419/85913
• Last update: 10.03.2025, 11:43 AM CET