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The Relationship Between Social Leisure and Life Satisfaction: Causality and Policy Implications

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Abstract

Social leisure is generally found to be positively correlated with life satisfaction in the empirical literature. We ask if this association captures a genuine causal effect by using panel data from the GSOEP. Our identification strategy exploits the change in social leisure brought about by retirement, since the latter is an event after which the time investable in (the outside job) relational life increases. We instrument social leisure with various measures of the age cohort specific probability of retirement. With such approach we document that social leisure has a positive and significant effect on life satisfaction. Our findings shed some light on the age-happiness pattern. Policy implications are also discussed.

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Notes

  1. This change of heart has begun to have an impact on policy making. For instance, the final report by the Stiglitz Commission created by the French President Sarkozy stresses the need for our measurement systems to movetheir focus from economic production to people’s well-being. A similar advice the Office of National Statistics in Britain has been invited to follow by the Prime Minister D. Cameron. On the other side of the Atlantic, three leading happiness scholars, Betsey Stevenson, Alan Krueger and Cass Sunstein all have senior government positions in the Obama administration

  2. We refer the interested reader to the comprehensive overview in Diener and Seligman (2004).

  3. The GSOEP is a longitudinal household survey sponsored by the Deutsche Forschungsgemeinschaft and organized by the German Institute for Economic Research (Berlin) and the Center for Demography and Economics of Aging (Syracuse University). We are grateful to these institutes and to the project director Dr. G. Wagner for making this dataset available.

  4. Becchetti et al. (2008) and Powdthavee (2008) show that the link between happiness and social life survives the elimination of this fixed component by using respectively German and British panel data.

  5. Meier and Stutzer (2008), who concentrate on volunteering, tackle the causality problem by using the collapse of the East Germany volunteering infrastructure.

  6. The concept is central M. Buber’s philosophy. For the Jewish scholar ‘Encounter’ (Begegnung) is an event or situation in which a relation (Beziehung) occurs. He also calls the encounter the sphere of the between. For Buber, ‘All real life is encounter’ ie we only live in relation to others.

  7. For a formalization of Scitovsky arguments see Pugno (2010).

  8. Corneo (2005) shows that in the OECD countries the hours spent in front of the TV grow together with the hours of work. An explanation for this phenomenon may be that overworked people will tend to resort to this kind of entertainment just because it requires less energy than more fulfilling leisure activities, relationships among them. In the information age a new impersonality risks to affect everyone: think of Facebook, a Web site that through bodiless sharing promises to combine the aura of intimacy with the safety of distance. The oxymoron is splendidly revealed by the cinematic portrait (The social network) of his inventor Mark Zuckerberg who creates a five-hundred-million-circle of “friends”, but is so work-obsessed and withdrawn that he can’t stay close to anyone.

  9. Antoci et al. (2007) show how bounded individual rationality and externalities combine in producing “social poverty” traps.

  10. According to these authors one of the strongest pieces of evidence in favor of complementarities across leisure is that an overwhelming share of the population both in Europe and the US takes its two days of leisure during Saturday and Sunday. There would be huge benefits from staggering work so that different people take different days off during the week: this could reduce commuting time and would allow capital to be spread over more workers. The fact that this is not done suggest that the costs in terms of forgone welfare due to less coordinated leisure would be sizable as well. However the relevant complementarities could be across work, rather than leisure.

  11. We notice however that the econometric techniques we use are unable to capture these more universal benefits of relational goods.

  12. The data used in this paper was extracted using the Add-On package PanelWhiz for Stata®. PanelWhiz (http://www.PanelWhiz.eu) was written by Dr. John P. Haisken-DeNew (john@PanelWhiz.eu). See Haisken-DeNew and Hahn (2006) for details. The PanelWhiz generated DO file to retrieve the data used here is available from us upon request.

  13. For the purpose of our empirical analysis we did not consider the subsamples of immigrant households and those belonging to of the high income households, as they are likely to increase the heterogeneity of the effect of social leisure over SWB.

  14. Question in 2007 SOEP personal questionnaire “How satisfied are you with your free time, 0 means totally unhappy, and 10 means totally happy”.

  15. In the 2007 SOEP personal questionnaire the variable named as “social gatherings” refers to the following question: Which of the following activities do you take part in during your free time? Please check off how often you do each activity: at least once a week, at least once a month, less often, never. Among the possible activity there was: “Meeting with friends, relatives or neighbours”. In this case, the variable “social gathering” should include the most common relational goods’ generating activities. For a detailed description of the variables see the “Appendix”, Table 8.

  16. In computing RTI we assume that each of the five selected relational activities has the same weight or importance in determining the value of the index, so we allow for perfect substitution between the relational activities. We also apply factor analysis and principal component analysis. We start by considering the correlation among the five selected questions (see Table 1) with the aim of aggregating them in a new relational composite indicator (Rel_CI). By applying the procedure used by Nicoletti et al. (2000) we selected a subset of principal components that accounts for the largest amount of variance among the individual sub-indicators. The other technical steps deal with the construction of the weights from the matrix of factor loadings after rotation. The final composite indicator (Rel_CI) we obtain is: Rel_CI = (0.17 * social gathering) + (0.09* volunteering activities) + (0.31*cultural activities) + (0.17 * sport) + (0.25 * religious activity). Findings obtained with such indicator are shown in Table 9 of the “Appendix”. Even if the distribution of the index is different, our findings confirm the significance of the RTI index.

  17. We underline that the use of an averaged value rather than of each single component is mainly motivated by data availability: none of the five selected questions are asked in the same year. Subject to the availability of at least one of the variables entering the RTI, we run our empirical analysis on the following waves: 1984–1986, 1998, 1992, 1994–1999, 2001, 2003, 2005 and 2007. In order to check the robustness of our findings to alternative ways of calculating the index we compute RTI2 which gives the following weights to different intensities of relational activities: 0 = never, 0.08 = once a year, 1 = once a month, 4 = once a week. The scale takes as point of reference the level of intensity equal to once a month, so that we assign 1 to once a month, 4 to once a week (as in a month there may be four weeks), 1/12 to less frequently because we interpret it as at least once a year (as in a year there are 12 months), and zero for never. Results are substantially unchanged and available in Table 10 of the “Appendix”.

  18. Differently from two previous studies which investigate the age-happiness relationship on the same data (Frijters and Beatton 2008; Van Landeghem, 2008), we do not restrict the analysis to West Germans, as in Frijters and Beatton (2008), and do not work only on the balanced panel, as in Van Landeghem (2008). Our main results are however supported also in these two specific subsamples. Results are omitted for reasons of space and available upon request.

  19. For a different opinion, focused on entry and survivorship bias, see Frijters and Beatton (2008).

  20. Equivalised income is household income which is adjusted by using an equivalence scale to take into account the size and composition of the household. Here we use the “OECD equivalence scale” which assigns a value of 1 to the first household member, of 0.7 to each additional adult and of 0.5 to each child. This scale (also called “Oxford scale”) was mentioned by OECD (1982) for possible use in “countries which have not established their own equivalence scale”. For this reason, this scale is sometimes labeled “(old) OECD scale”. Adoption of different equivalent scales or of the simple household income in the estimate does not affect the substance of our findings. Evidence is omitted and available upon request.

  21. Of course it is not difficult to think of other (concurrent) explanations: it is possible that those who retire later hold particularly psychologically rewarding jobs, or, due to a relatively strong work ethics and competitive attitude take pride from working at a later age. However we have not attempted to disentangle these various possible effects.

  22. Börsch-Supan and Schnabel (1999) in their overview on the German Social Security system, as well as Berkel and Börsch-Supan (2003) in their estimations of the long term impact of reforms on retirement decisions in Germany made use of the retirement statistics drawn from the GSOEP to describe the national figures. Proportion of retirees and mean retired people by gender over the years, by West and East Germany are shown in Table 11 of the “Appendix”.

  23. National statistics are supplied by the German association of public pension providers (VerbandDeutscherRentenversicherungsträger–VdR) and cover the period 1989–2005. The data elaboration we use here is by Sackmann (2007).

  24. Any person whose capacity for social and/or occupational integration is severely restricted by an impairment or reduction of their physical and/or mental capacity is eligible for the aid awarded by the social assistance.

  25. Besides old age pensions the German welfare system provides disability benefits to workers of all ages not able to carry on a regular employment. If this inability is complete they receive full old age benefits, the so called disability pension (“Erwerbsunfähigkeitsrente”, EU). A person that can work only half of the time or less compared to a healthy person received two-thirds of old age benefits (“Berufsunfähigkeitsrente”, BU). In the 1970s and early 1980s, the German jurisdiction has interpreted the rules on disability very broadly, in particular the applicability of the first rule. Disability is the most important pathway to retirement for civil servants: 47% of those who retired in the year 1999 used disability retirement. Hence we may consider the disabled group as a hybrid set (of not fully- irregularly employed partially subsidized workers) which stands between full employment and straight unemployment. See Borsch-Supan and Wilke (2004).

  26. Results are available by the authors upon requests.

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Acknowledgments

The ideas for this paper have been discussed in several seminars on the economics of life satisfaction with colleagues such as Stefano Bartolini, Luigino Bruni, Andrew Clark, Raphael Di Tella, Bruno Frey, Benedetto Gui. Luca Stanca Alois Stutzer, Robert Waldmann. We are grateful to them for comments and suggestions received.

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Authors and Affiliations

  1. Department of Economics, University of Rome “Tor Vergata”, Via Columbia 2, 00133, Rome, Italy

    Leonardo Becchetti

  2. University of Rome “Tor Vergata”, Via Columbia 2, 00133, Rome, Italy

    Elena Giachin Ricca

  3. Department of Economics, University of Rome “Tor Vergata”, Via Columbia 2, 00133, Rome, Italy

    Alessandra Pelloni

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  1. Leonardo Becchetti
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  2. Elena Giachin Ricca
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  3. Alessandra Pelloni
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Correspondence to Alessandra Pelloni.

Appendix

Appendix

See Tables 8, 9, 10, 11.

Table 8 Variable description
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Table 9 Relational time composite index (Rel_CI): linear fixed effect estimation for life satisfaction and IV fixed effect estimation with over identified models. GSOEP 1984–2007, whole sample
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Table 10 Life satisfaction and RTI2 (index computed aggregating the 5 relational time variables normalized as follows: 0 = never, 0.08 = once a year, 1 = once a month, 4 = once a week): linear fixed effect estimation for life satisfaction and IV fixed effect estimation with over identified models (GSOEP 1984–2007, whole sample)
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Table 11 Proportion of retirees (Quota) and mean retired people by gender over the years, by West and East Germany
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Becchetti, L., Giachin Ricca, E. & Pelloni, A. The Relationship Between Social Leisure and Life Satisfaction: Causality and Policy Implications. Soc Indic Res 108, 453–490 (2012). https://doi.org/10.1007/s11205-011-9887-5

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