Abstract
This paper studies both pecuniary and non-pecuniary factors affecting happiness—an issue that has sparked a great deal of interest in the economic literature. Using an ordered Probit model and the 1998 general social survey (GSS) data, the paper empirically demonstrates the extent to which socioeconomic and demographic variables along with faith and emotionally based factors may determine happiness. The 1998 survey was conducted nearly at the conclusion of one of the longest economic expansion—a high income low inflation era in the US history. However, the findings tend to suggest that the absolute value of nominal income insignificantly, but non-pecuniary elements (faith and emotionally based factors including financial security) significantly determine happiness.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
Notes
For an extensive review of the literature on the determinants of happiness, see Cummins (2000).
Education is not included in Winkelmann and Winkelmann’s study.
The happiness issue has also been specified in the Singapore National Pledge.
The estimated variance of the regression coefficients is large resulting in insignificant, inconsistent, and biased regression coefficients.
For more information, see Swinyard et al. (2001)
The importance of religion in well-being has also recently been reported by the scientists at the Duke University’s Center for Spiritually Theology and Health (2000–2007). http://www.dukespiritualityandhealth.org.
Converting GEN into a dichotomous dummy variable (male = 1 and female = 0) insignificantly reverses the sign of the GEN regression coefficient and negligibly decreases the estimated z-Statistics for the thresholds.
For the data and detailed questionnaire, see http://www.icpsr.umich.edu/GSS/. The age brackets have been included as separate explanatory variables because age is a focal point in Gerdtham and Johannesson’s study. Although the lower end of AGE1 is generically mentioned in the questionnaire, the survey is aimed at the upper end (adult population). A number of other related explanatory variables such as education at the high school level, trust in each other, confidence in the US. Congress, relation with neighbors, belief in God, and the actual income brackets (as well as income in the logarithmic format, and in squared format) were originally included in the happiness function. The variables were excluded from the final model because they did not pass the model selection criteria (MSC) test. The estimated model has been chosen by the residuals based MSA tests—the Hannan–Quinn (H–Q) and Schwarz Baysian (SC) criteria. The procedure involves adding appropriate variables to a standard happiness model (e.g., that of Gerdtham and Johannesson’s) and minimizing the numerical values of the H–Q and SC criteria. Since the dependent variable is ordinal in nature, to avoid estimation problems, where appropriate, the explanatory variables have been transformed into a series of suitable dummy variables.
Note that the intercept is not independently identified from the thresholds. Furthermore, since the maximum likelihood estimated standard errors of the regression coefficients are asymptotic, the reported z-Statistics are most relevant.
The results of an ordered multinomial logit technique (the distribution of e t is a logistic function) are generally similar to those reported.
Commonly, the ordering is such that the smaller the number, the higher the level of unhappiness and contrariwise—e.g., Gerdtham and Johannesson’s study. However, the happiness data coded by the GSS do not conform to this general rule.
Toward that end, the probability of falling in the lower end (very happy = 1) goes in the opposite direction of the sign of the unadjusted estimated regression coefficient, while the probability of falling in the upper end (not too happy = 3) goes in the same direction as that of the unadjusted estimated coefficient—see Greene (2003) and Johnston and Dinardo (1997).
As is well known, in the OMPM, the estimated significant regression coefficients do not measure the marginal impact of independent variables on the dependent variable. Nevertheless, the first-order conditions [∂P(HAP)/∂explanatory variables] expressly provide unambiguous guidelines for P(HAP = 1) and P(HAP = 3). In that spirit, [∂P(HAP = 1)/∂an explanatory variable] has a sign opposite of the estimated regression coefficient, while [∂P(HAP = 3)/∂an explanatory variable] has the same sign as that of the estimated coefficient. The sign of the middle case [∂P(HAP = 2)/∂an explanatory variable] is ambiguously determined by the other two density functions. For brevity, proofs have not been provided—see Greene (2003).
Fixed individual effects appear to be present.
Some researchers have reported no significant happiness difference between divorced and people who stayed married in unhappy marriages—see for example, Institute for American Values, 2002, Does Divorce Make People Happy? Findings from a Study of Unhappy Marriages By Linda J. Waite, Don Browning, William J. Doherty, Maggie Gallagher, Ye Luo, and Scott M. Stanley. Boston Glob, May 12, 2007, reports that the US divorce rate (still highest among developed and developing nations) dropped to the lowest level since 1970. The reported rate is quite misleading because during the same time period, the marriage rate dropped, the number of couples who postponed marriage by living together (so called “marrying smarter”) increased sharply, and the number of prenuptial agreements (among materialistically endowed couples) increased substantially.
This pattern is observed for widowed in the 65 and older age brackets at which most life goals have already been reached, social pressure is minimal, and family obligations are quite negligible. Although males and females react differently to widowhood, they tend to remain active in their social network with friends, neighbors, and relatives—particularly, the activities that did not require their “significant others.” Consistently, one major source of strength throughout the process of identifying with the role of widowhood, appears to be religious beliefs, activities, and supports. For more information, see Normal Aging II—Report from the Duke Longitudinal Studies, 1970–1973, edited by Erdman Palmore.
The detailed findings are available upon request.
References
Alesina, A., Tella, R. D., & MacCulloch, R. (2004). Inequality and happiness: Are Europeans and American different? Journal of Public Economics, 88, 2009–2042.
Allport, G. W., & Ross, J. M. (1967). Personal religious orientation and prejudice. Journal of Personality and Social Psychology, 5, 423–443.
Andrews, F. M., & Robinson, J. P. (1991). Measures of subjective well-being. In J. P. Robinson, P. Shaver, & L. Wrightsman (Eds.), Measures of personality and social psychological attitudes. San Diego: Academic Press.
Andrews, F. M., & Withey, S. B. (1976). Social indicators of well-being: Americans’ perceptions of life quality. New York: Plenum.
Argyle, M. (1989). The psychology of happiness. London: Routledge.
Belk, R. W. (1985). Materialism: Trait aspects of living in the material world. Journal of Consumer Research, 12, 265–279.
Clark, A. E., & Oswald, A. J. (1994). Unhappiness and unemployment. Economic Journal, 104, 648–659.
Cummins, R. A. (2000). Personal income and subjective well-being: A review. Journal of Happiness Studies, 1, 133–158.
Diener, E. (1984). Subjective well-being. Psychological Bulletin, 95, 542–575.
Donahue, M. J. (1985) Intrinsic and extrinsic religiousness: Review and meta analysis. Journal of Personality and Social Psychology, 48, 400–419.
Ellison, C. G. (1991). Religious involvement and subjective well-being. Journal of Health and Social Behavior, 32, 80–99.
Ellison, C. G., Gay, D. A., & Glass, T. A. (1989). Does religious commitment contribute to individual life satisfaction? Social Forces, 68(1), 100–123.
Gerdtham, U.-G., & Johannesson, M. (2001). The relationship between happiness, health, and socioeconomic factors: Results based on Swedish microdata. Journal of Socio-Economics, 30, 553–557.
Graham, C., Eggers, A., & Sukhtankar, S. (2004). Does happiness pay? An exploration based on panel data from Russia. Journal of Economic Behavior and Organization, 55, 319–342.
Graham, C., & Pettinato, S. (2001). Happiness, markets, and democracy: Latin American in comparative perspectives. Journal of Happiness Studies, 2(3), 237–268.
Graham, C., & Pettinato, S. (2002). Frustrated achievers: Winners, losers, and subjective well being in new market economies. Journal of Development Studies, 38, 100–140.
Greene, W. H. (2003). Econometric analysis (5th ed.). Prentice Hall.
Hadaway, C. K., & Roof, W. C. (1978). Religious commitment and the quality of life in American society. Review of Religious Research, 19, 295–307.
Heady, B., & Wooden, M. (2004). The effects of wealth, and income on subjective well-being and ill-being. The Economic Record, 80, 524–533.
Johnston, J., & Dinardo, J. (1997). Econometric methods (4th ed.). McGraw Hill.
Lane, R. E. (1994). The road not taken: Friendship, consumerism, and happiness. Critical Review, 8(4), 521–554.
McFarland, S. G. (1989). Religious orientations and the targets of discrimination. Journal for the Scientific Study of Religion, 28, 324–336.
Phelps, C. D. (2001). A clue to the paradox of happiness. Journal of Economic Behavior and Organization, 45(3), 293–300.
Richins, M. L. (1987). Media, materialism, and human happiness. Advances in Consumer Research, 14, 352–356.
Richins, M. L., & Dawson, S. (1992). A consumer values orientation for materialism and its measurement: Scale development and validation. Journal of Consumer Research, 19, 303–316.
Sirgy, M. J. (1998) Materialism and quality of life. Social Indicators Research, 43, 227–260.
Spilka, B., & Schmidt, G. (1983). General attribution theory for the psychology of religion: The influence of event-character on attributions to god. Journal for the Scientific Study of Religion, 22, 326–339.
Swinyard, W. R., Kau, A. H.-K., & Phua, H.-Y. (2001). Happiness, materialism, and religious experience in the US and Singapore. Journal of Happiness Studies, 2, 13–32.
Theodossiou, I. (1998). The effects of low pay and unemployment on psychological well-being: A logistic regression approach. Journal of Health Economics, 17, 85–104.
Veenhoven, R. (1984). Conditions of happiness. Dordrecht Netherlands: Kluwer Academic.
Veenhoven, R. (1995). Developments in satisfaction research. Social Indicators Research, 37, 1–46.
Ventis, W. L. (1995). The relationships between religion and mental health. Journal of Social Issues, 51, 33–48.
Wilson, W. R. (1960). An attempt to determine some correlates and dimensions of hedonic tone. Dissertation Abstracts, 22, 2814.
Wilson, J. Q. (1994). Wealth and happiness. Critical Review, 8(4), 555–64.
Winkelmann, L., & Winkelmann, R. (1998). Why are the unemployed so unhappy? Evidence from panel data. Economica, 65, 1–15.
Acknowledgements
Construtive comments and suggestions of three anonymous referees of this journal are gratefully acknowledged—any remaining shortcomings are solely mine and they should be exonerated from responsibility.
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Moghaddam, M. Happiness, Faith, Friends, and Fortune—Empirical Evidence from the 1998 US Survey Data. J Happiness Stud 9, 577–587 (2008). https://doi.org/10.1007/s10902-008-9090-9
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10902-008-9090-9