Abstract
This study aims to provide a comparative analysis between non-transition and transition countries, with focus on exploring the life satisfaction costs of deprivation aspects, i.e. material, subjective, and relative. Relative deprivation is measured using the Gini index at the city level, since the Gini index at the country level is unable to capture the total influence of relative income inequality on life satisfaction for both sets of countries. A negative association between these measures and life satisfaction is suggestive of deprivation dimensions being quality-of-life important considerations in the EU and neighbouring candidate countries. They capture objective and subjective income inequalities among different households within the same time point. The relative importance of such indicators is also of particular interest because it is driven by social mobility considerations, which are more related with whether people think they can improve their lot in life and how easy/hard this is. This is more related to present versus future concerns about inequalities of same households across time. The study is based on a comparative analysis of data taken by a nationally representative household database from the 2016 European Quality of Life Survey. We evaluate the hypotheses using a two-level linear mixed-effects model of individual responses nested in 33 European countries (28 EU plus 5 non-EU countries—Albania, Montenegro, North Macedonia, Serbia, and Turkey). Estimates are generated for the pooled sample and separately for the non-transition (West-EU) and transition post-communist (East-EU plus non-EU) countries. The results suggest that there are significant life satisfaction costs attached to all three aspects of deprivation. However, the comparative importance of relative deprivation, as a measure of income inequality at the city/local level, is significantly larger than material and subjective deprivation, even after controlling for equivalized household income. This relationship is more pronounced for transition countries as compared to non-transition (post-communist) ones.
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Notes
In line with much of the related research, the terms ‘(overall) life satisfaction’, ‘(subjective) satisfaction with life’, ‘happiness’ and ‘subjective wellbeing’ are used equivalently. The reason for this is that survey responses to questions on life satisfaction or subjective wellbeing are highly correlated with alternative indicators of happiness (Ferrer-i-Carbonell and Frijters 2004; Kahneman et al. 1999; E. Nikolova and Sanfey 2016). Measures of life satisfaction are also used extensively in empirical studies in ‘economics of happiness’. Similarly, the ‘post-communist happiness gap’ is also mainly concerned with a gap in life satisfaction (Amini and Douarin 2020; Djankov et al. 2016).
However, it is also recognized that subjective wellbeing (SWB) represents a comprehensive concept that incorporates affective (happiness) and cognitive (life satisfaction) components of life, which, respectively, relate to the emotional and evaluative sides of SWB (Diener et al. 2003). Indeed, Frey and Stutzer (2010) argue that happiness is affect (an emotional assessment) and life satisfaction is evaluation (a cognitive assessment) which is much related to how people evaluate their current quality of life in comparison with the ideal/benchmark they would seek for themselves. Additionally, the determinants of life satisfaction and happiness, such as income (Kahneman and Deaton 2010) have been shown to differ, implying a distinction between these concepts.
This is the lower/narrower level that the EQLS database includes as opposed to the country level Gini Index which is the same for all individuals in the 2016 year, something we control for in the macro level variables.
Captured by the coefficients on the dummy variable for whether the respondent comes from a transition economy.
Standardized beta coefficients for the: (1) pooled sample (items not afforded: − 0.092***; Gini index at city level: − 0.711***); (2) non-transition sample (items not afforded: − 0.107***; Gini index at city level: − 0.683***); (3) transition sample (items not afforded: − 0.180***; Gini index at city level: − 0.946***).
Standardized beta coefficients for the: (1) Pooled sample (items not afforded: − 0.081***; Gini index at city level: − 0.800***); (2) Non-transition sample (items not afforded: − 0.110***; Gini index at city level: − 0.624***); (3) Transition sample (items not afforded: − 0.169***; Gini index at city level: − 0.899***).
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Drishti, E., Shkreli, Z., Zhllima, E. et al. Deprivation, Social Mobility Considerations, and Life Satisfaction: A Comparative Study of 33 European Countries. Comp Econ Stud 65, 511–550 (2023). https://doi.org/10.1057/s41294-023-00216-8
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DOI: https://doi.org/10.1057/s41294-023-00216-8