Who Settles for Less? Subjective Dispositions, Objective Circumstances, and Housing Satisfaction
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In recent years there has been growing interest in individuals’ self-perceptions of their wellbeing on the grounds that these complement well-established objective indicators of welfare. However, individuals’ assessments depend on both objective circumstances and subjective, idiosyncratic dispositions, such as aspirations and expectations. We add to the literature by formulating a modelling strategy that uncovers how these subjective dispositions differ across socio-demographic groups. This is then tested using housing satisfaction data from a large-scale household panel survey from Australia. We find that there are significant differences in the way in which individuals with different characteristics rate the same objective reality. For instance, male, older, migrant, and Indigenous individuals rate equal housing conditions more favourably than female, younger, Australian-born, and non-Indigenous individuals. These findings have important implications for how self-reported housing satisfaction, and wellbeing data in general, are to be used to inform evidence-based policy.
KeywordsWellbeing Satisfaction Housing Subjective dispositions Housing conditions Fixed effects
We would like to thank Mark Western, Cameron Parsell, and an anonymous referee for helpful comments and suggestions on an earlier draft which substantively improved this work. This paper uses data from the Household, Income and Labour Dynamics in Australia Survey, funded by the Australian Government Department of Families, Housing, Community Services and Indigenous Affairs and managed by the Melbourne Institute of Applied Economic and Social Research.
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