Subjective Well-Being and Adaptation. The Case of Uruguay

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Abstract

We assess the recent evolution of the quality of life in Uruguay, analysing whether current subjective well-being levels are conditioned by the objective well-being trajectory of each individual. We explore subjective well-being in 3 domains: life, economic situation and housing satisfaction. Although adaptation has been addressed in the empirical literature for developed countries, there is scarce evidence for developing countries due to the lack of suitable panel datasets. In this article, we provide an econometric test of the adaptation hypothesis based on longitudinal data from Uruguay for the years 2004, 2006 and 2011/12 (Estudio Longitudinal de Bienestar en Uruguay). Our main findings show that present levels of life, economic and housing satisfaction are each positively correlated with the corresponding contemporary and lagged objective variable of interest. Thus, we reject the adaptation hypothesis in all the dimensions considered. We also explore the role of social interactions in the 3 subjective well-being dimensions, finding out that average objective well-being of the reference group (either income or crowding) is not associated with individual subjective well-being levels.

Keywords

Adaptation Adaptive preferences Subjective well-being Uruguay 

Notes

Acknowledgements

We are grateful to Sabina Alkire, Veronica Amarante, Rodrigo Arim, Andrew Clark, Flavio Comim, Ana Fascioli, Peter Fitermann, Gustavo Pereira, Ambra Poggi, Agustín Reyes, participants at the meetings of the Human Development and Capabilities Association in Lima and ECINEQ in Catania and two anonymous referees for many comments and suggestions on earlier versions of this article. Financial help from Fondo Clemente Estable and Comision Sectorial de Investigación Científica de la Universidad de la República is very gratefully acknowledged. All errors remain our own.

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Copyright information

© Springer Science+Business Media B.V., part of Springer Nature and The International Society for Quality-of-Life Studies (ISQOLS) 2018

Authors and Affiliations

  1. 1.Instituto de EconomiaUniversidad de la RepublicaMontevideoUruguay

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