You conclude that there is a degree of Easterlin Paradox—that happiness increases less with growth over time than would be expected from how happiness increases with income within a country and how it increases with income levels between countries.
To what extent do you think that the remaining Easterlin effect is due to status levels being an important aspect of happiness so we don’t benefit much if our neighbours get richer with us? Or do respondents adjust life satisfaction scales as life expectations advance with incomes over time, so that happiness improves but is not measured?
Great question. The difference between the cross-sectional (CS) positive relation between GDP pc and life satisfaction and the nill time-series (TS) relation is best explained by social comparison. See the article for details.
You conclude that there is a degree of Easterlin Paradox—that happiness increases less with growth over time than would be expected from how happiness increases with income within a country and how it increases with income levels between countries.
To what extent do you think that the remaining Easterlin effect is due to status levels being an important aspect of happiness so we don’t benefit much if our neighbours get richer with us? Or do respondents adjust life satisfaction scales as life expectations advance with incomes over time, so that happiness improves but is not measured?
Great question. The difference between the cross-sectional (CS) positive relation between GDP pc and life satisfaction and the nill time-series (TS) relation is best explained by social comparison. See the article for details.
However, people also surely adjust their expectations over time, Bernard Van Praag used the term preference drift to refer to the phenomenon described (https://www.nowpublishers.com/article/DownloadSummary/MIC-026), and psychologists use the term hedonic treadmill. This is important, but not enough to explain the difference between the CS and TS results. There are other explanations too, essentially that it is the quality of growth that matters, see (https://www.sciencedirect.com/science/article/abs/pii/S0305750X17300049)
Thank you for your response, and for referencing the two papers.