, Volume 1, Issue 1, pp 79-102

Happiness Prospers in Democracy

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Abstract

An econometric analysis of a happiness function, based on a surveyof 6,000 persons in Switzerland, indicates that:

(1) the more developed the institutions of direct democracy, the happier the individuals are;

(2) people derive procedural utility from the possibility of participating in the direct democratic process over and above a more favorable political outcome;

(3) the unemployed are much less happy than the employed, independent of income;

(4) higher income is associated with higher levels of happiness.

The consideration of institutional differences in cross-regional data offers important new insights into happiness research.