Positional Concerns Through the Life Cycle: Evidence from Subjective Well-Being Data and Survey Experiments

47 Pages Posted: 18 Feb 2012

See all articles by Alpaslan Akay

Alpaslan Akay

IZA Institute of Labor Economics

Peter Martinsson

University of Gothenburg - Department of Economics and Statistics

Abstract

This paper uses both subjective well-being and survey experimental data to analyze how people's positional concerns regarding income and goods vary with age. The subjective well-being approach is mainly based on German panel data for the period 1984-2009 (German Socio-Economic Panel), while the survey experimental approach is based on a tailor-made experimental design conducted among Swedish adults. Our analysis suggests that the degree of positional concerns is not homogenous across the life cycle. Our different analytical approaches show a robust life cycle pattern of positional concerns: young people experience no or a low degree of positional concerns, yet the level of concerns for income increases gradually and significantly with age. The results also differ across goods: while car consumption is similar to income, the positional concern for leisure time decreases through the life cycle.

Keywords: positional concerns, life cycle, subjective well-being, survey experiment

JEL Classification: C90, D63

Suggested Citation

Akay, Alpaslan and Martinsson, Peter, Positional Concerns Through the Life Cycle: Evidence from Subjective Well-Being Data and Survey Experiments. IZA Discussion Paper No. 6342, Available at SSRN: https://ssrn.com/abstract=2007333

Alpaslan Akay (Contact Author)

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Peter Martinsson

University of Gothenburg - Department of Economics and Statistics ( email )

Box 640
Vasagatan 1, E-building, floor 5 & 6
Göteborg, 40530
Sweden

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