Happiness functions with preference interdependence and heterogeneity: the case of altruism within the family

Abstract

This study investigates the prevalence and extent of altruism by examining the relationship between parents’ and their adult children’s subjective well-being in a data set extracted from the German Socio-Economic Panel. To segregate the share of parents with altruistic preferences from those who are selfish, we estimate a finite mixture regression model. We control for various sources of potential bias by taking advantage of the data’s panel structure. To validate our modeling approach, we show that predicted altruists indeed make higher average transfer payments.

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Correspondence to Adrian Bruhin.

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Responsible editor: Deborah Cobb-Clark

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Bruhin, A., Winkelmann, R. Happiness functions with preference interdependence and heterogeneity: the case of altruism within the family. J Popul Econ 22, 1063–1080 (2009). https://doi.org/10.1007/s00148-008-0198-3

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Keywords

  • Altruism
  • Subjective well-being
  • Finite mixture regression models

JEL Classification

  • C23
  • D64