Happiness and economic growth : lessons from developing countries

305 Pages·2015·4.005 MB·English

by  Clark, Andrew E., Senik-Leygonie, Claudia

Happiness and Economic Growth
Studies of Policy Reform
Series Editors
Daniel Cohen and François Bourguignon
This series brings new and innovative policy research to the forefront
of academic and policy debates.
It addresses the widest range of policies, from macroeconomics to
welfare, public finance, trade, migration, and the environment. It
hosts collaborative work under the auspices of CEPR, CEPREMAP,
and the Paris School of Economics.
Titles Published in the Series
The Economics of Clusters
Gilles Duranton, Philippe Martin, Thierry Mayer,
and Florian Mayneris
Cultural Integration of Immigrants in Europe
Edited by Yann Algan, Alberto Bisin, Alan Manning,
and Thierry Verdier
Happiness and Economic Growth: Lessons from Developing Countries
Edited by Andrew E. Clark and Claudia Senik
Happiness and Economic
Growth
Lessons from Developing Countries
Edited by
Andrew E. Clark and Claudia Senik
1
1
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First Edition published in 2014
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Contents
List of Contributors vii
List of Figures xi
List of Tables xiii
Introduction 1
Andrew E. Clark and Claudia Senik
1. Life Satisfaction in the Transition from Socialism to
Capitalism: Europe and China 6
Richard A. Easterlin
Discussion by Yann Algan
2. The Great Happiness Moderation: Well-being Inequality
during Episodes of Income Growth 32
Andrew E. Clark, Sarah Flèche, and Claudia Senik
Discussion by Paul Seabright
3. Poor, or Just Feeling Poor? On Using Subjective Data in
Measuring Poverty 140
Martin Ravallion
Discussion by Ekaterina Zhuravskaya
4. Subjective Well-being and Social Evaluation: A Case Study
of China 179
John Knight and Ramani Gunatilaka
Discussion by Xiaobo Zhang
5. Income Comparisons in Chinese Villages 216
Andrew E. Clark and Claudia Senik
Discussion by Ada Ferrer-i-Carbonell
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Contents
6. Happiness and Economic Growth: A Panel Discussion 240
Stéfan Lollivier, Conal Smith, Martin Ravallion, and
Richard A. Easterlin
7. Concluding Remarks. How Inequality Matters to
Well-being: Agency, Adaptation, and Changes versus Levels 249
Carol Graham
Name Index 267
Subject Index 271
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List of Contributors
Yann Algan is Professor of Economics at Sciences Po, Paris. He is also a fellow
at CEPR and IZA and is co-head of CEPREMAP’s macroeconomic program.
His research interests are public economics, political economy, experimental
economics, and macroeconomics. He is the author of La Société de défiance
(2012) (with Pierre Cahuc) and Cultural and Economic Integration in Europe
(Oxford University Press, 2010) (with Alberto Bisin, Alan Manning, and
Thierry Vierder) and has published in top economic journals such as American
Economic Review, Quarterly Journal of Economics, Economic Journal, and Journal of
European Economic Association. He was awarded Best French Young Economist
in 2009, has been a visiting professor at MIT (2007) and Harvard (2008), and is
co-director of the Sciences Po Master’s course in Economics and Public Policy.
Andrew E. Clark holds a PhD from the LSE. He is CNRS Research Professor at
the Paris School of Economics, and previously held posts at Dartmouth, Essex,
CEPREMAP, DELTA, the OECD, and the University of Orléans. His work has
used job and life satisfaction scores, and other psychological indices as proxy
measures of utility. His research has addressed relative utility or comparisons
(to others like you, to your partner, and to yourself in the past), and the use of
long-run panel data in collaboration with psychologists to map out habituation
to life events (such as job loss, marriage, and divorce).
Richard A.  Easterlin is currently University Professor and Professor of
Economics, University of Southern California. He is a member of the National
Academy of Sciences and a Distinguished Fellow of the American Economic
Association. He is also a Fellow of the American Academy of Arts and Sciences,
the Econometric Society, and the Institute for the Study of Labor (IZA), and is a
former president of the Population Association of America, Economic History
Association, and Western Economic Association International. He is the author,
among other things, of Happiness, Growth and the Life Cycle (2010), The Reluctant
Economist (2004), Growth Triumphant: The 21st Century in Historical Perspective
(1996), and Birth and Fortune: The Impact of Numbers on Personal Welfare (1980;
2nd edn 1987), and editor of Happiness in Economics (2002). His current research
is on the association between economic growth, public policy, and subjective
well-being.
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List of Contributors
Ada Ferrer-i-Carbonell is a tenured scientist in the Institute for Economic
Analysis (IAE-CSIC) in Barcelona and Barcelona Graduate School of
Economics’ Deputy Director for Academic Programs. She is Research Fellow
at IZA, Barcelona GSE, and MOVE, and an associate editor of the Journal
of Economic Behavior and Organization. Ada has PhDs in Economics from
Rensselaer Polytechnic Institute (United States, 2003) and the Tinbergen
Institute (University of Amsterdam, 2003). Her current interests are in the
area of welfare analysis (through subjective well-being measures), including
health, inequality, and risk attitudes. She has published (with Bernard Van
Praag) Happiness Quantified: A Satisfaction Calculus Approach (Oxford University
Press, 2004).
Sarah Flèche is a PhD student from the European Doctoral Program (EDP),
jointly organized by the Paris School of Economics and the London School
of Economics. Her research interests include economics of happiness, health
and institutional studies. She has an M.A. degree in economics from the Ecole
Normale Supérieure. From 2010 to 2013, she was a consultant at the OECD and
was involved in a research program on new measures of well-being.
Ramani Gunatilaka has been working as a development economist in Sri
Lanka and the region since graduating from the Universities of London and
Oxford in 1992–3. She received a PhD in Applied Econometrics from Monash
University, Australia in 2006 for her thesis on income distribution in Sri Lanka
after economic liberalization. She is a member of the Faculty of Graduate
Studies, University of Colombo, Sri Lanka. Her research has concentrated on
poverty alleviation, rural development, microfinance, and labor market issues
in Sri Lanka, Afghanistan, and the Maldives, and on the determinants of
subjective well-being in China.
Carol Graham is Leo Pasvolsky Senior Fellow at the Brookings Institution
and College Park Professor at the University of Maryland. She has been a Vice
President at Brookings and a Special Advisor to the Vice President of the Inter-
American Development Bank. Graham is the author of numerous books—
most recently The Pursuit of Happiness: An Economy of Well-Being (Brookings,
2011) and Happiness Around the World: The Paradox of Happy Peasants and
Miserable Millionaires (OUP, 2009)—and has published articles in a range of
journals including the World Bank Research Observer, Health Affairs, Journal
of Economic Behavior and Organization, Health Economics, and Journal of Socio-
Economics. Her work has been reviewed in Science, The New Yorker, and the
New York Times, among others. She has an A.B. from Princeton, an M.A. from
Johns Hopkins, a PhD from Oxford University, and three beautiful children.
John Knight is Emeritus Professor of Economics and Emeritus Fellow of
St Edmund Hall in the University of Oxford. He has conducted research on
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List of Contributors
African countries and on China, mainly on issues such as human resources,
poverty, and subjective well-being. His recent books include Towards a Labour
Market in China (2005) and China’s Remarkable Economic Growth (2012; both
Oxford University Press). He holds a Leverhulme emeritus fellowship, is a
visiting professor at Beijing Normal University, and is the academic director of
the Oxford Chinese Economy Programme.
Stéfan Lollivier is now working in the French Institute of Statistics as director
of a program in charge of the implementation of a register of dwellings. He
was previously Director of Demographic and Social Statistics in the same
institute (2004–11) and Director of the Ecole Nationale de la Statistique
et de l’Administration Economique (ENSAE, 1999–2004). In 2010–11, he
co-chaired the European Task Force about Quality of Life in charge of the
implementation of the Stiglitz recommendations. Recent publications include
a chapter in The Econometrics of Panel Data (3rd edn: Springer Verlag, 2008),
ed. Matyas and Sevestre, with M. Lechner and T. Magnac (2008) and a paper
about unemployment in the International Economic Review with Laurence Rioux
(2010).
Martin Ravallion holds the inaugural Edmond D. Villani Chair of Economics
at Georgetown University, prior to which he was Director of the World Bank’s
research department. He has advised numerous governments and international
agencies on poverty and policies for fighting it, and he has written extensively
on this and other subjects in economics, including three books and 200 papers
in scholarly journals and edited volumes. He is President-elect of the Society for
the Study of Economic Inequality, a Senior Fellow of the Bureau for Research
in Economic Analysis of Development, a Research Associate of the National
Bureau of Economic Research, USA, and a non-resident Fellow of the Center
for Global Development. Among various prizes and awards, in 2012 he was
awarded the John Kenneth Galbraith Prize from the American Agricultural and
Applied Economics Association.
Paul Seabright is Professor of Economics at the Toulouse School of Economics
and Director of the Institute for Advanced Study in Toulouse. He has taught at the
Universities of Oxford and Cambridge and at the Ecole Polytechnique in Paris.
His book The Company of Strangers: A Natural History of Economic Life (2nd edn,
Princeton 2010) was shortlisted for the 2005 British Academy Book Prize. His
most recent book The War of the Sexes: How Conflict and Cooperation Have Shaped
Men and Women from Prehistory to the Present, was published by Princeton in 2011.
Claudia Senik is Professor of Economics at the Paris School of Economics
and the University Paris-Sorbonne. She is also a member of the IZA and of
the Institut Universitaire de France. Educated at the Ecole Normale Supérieure,
she received her PhD from EHESS. Her main research areas include happiness
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