published in: Economic Journal, 2008, 118 (529), F222–F243
We look for evidence of habituation in twenty waves of German panel data: do individuals, after life and labour market events, tend to return to some baseline level of wellbeing? Although the strongest life satisfaction effect is often at the time of the event, we find significant lag and lead effects. We conclude that there is complete adaptation to divorce, widowhood, birth of first child, and layoff. However, adaptation to marriage is only incomplete, and there is no adaptation to unemployment for men. In general, men are more affected by labour market events (unemployment and layoffs) than are women. Last, we find no consistent evidence that happiness provides insurance against hard knocks: those with high and low baseline satisfaction levels are broadly equally affected by labour market and life events.
We use cookies to provide you with an optimal website experience. This includes cookies that are necessary for the operation of the site as well as cookies that are only used for anonymous statistical purposes, for comfort settings or to display personalized content. You can decide for yourself which categories you want to allow. Please note that based on your settings, you may not be able to use all of the site's functions.
Cookie settings
These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.
In order to further improve our offer and our website, we collect anonymous data for statistics and analyses. With the help of these cookies we can, for example, determine the number of visitors and the effect of certain pages on our website and optimize our content.