How Conscious Are You of Others? Further Evidence on Relative Income and Happiness

Lee, Sun Youn; Ohtake, Fumio

How Conscious Are You of Others? Further Evidence on Relative Income and Happiness

Lee, Sun Youn; Ohtake, Fumio

Institute of Social and Economic Research Discussion Papers, 2018, 1022, 1-41

Number of Access:516（2025-09-09 18:00 Counts）

Identifier to cite or link to this item: https://hdl.handle.net/11094/67813

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Title	How Conscious Are You of Others? Further Evidence on Relative Income and Happiness
Creator	NRID 1000040711924 1000040711924 CreatorName Lee, Sun Youn
Creator	NRID 1000050176913 1000050176913 ORCID 0000-0002-8825-7446 0000-0002-8825-7446 researchmap permalink ohtake ohtake Scopus Author ID 6701666319 6701666319 CreatorName Ohtake, Fumio
Subject	Happiness
	relative income
	relative consciousness
	utility
Abstract	Extant research has found that an individual’s happiness is relative with respect to income, suggesting that it rises with own income and falls as the income of a reference group increases. Some recent studies emphasize that the effect of relative income is mediated by the extent to which people compare themselves with others (hereinafter, “relative consciousness”). Using the survey data of representative sample of Japan and the U.S., this paper extends the existing literature by providing a statistical evidence that underlines the importance of the intensity of relative consciousness in association with the perception of reference-group income in determining an individual’s happiness and his/her decision in line with the maximization of the utility. First, we find people who are highly conscious of others’living standards are unhappier in Japan but happier in the U.S. This opposite effect between the two countries is also found to exist when the same estimation is conducted with panel data. Second, the positive relationship between relative consciousness and happiness found in the U.S. results from the perception of reference-group income: highly conscious people compare downward in the U.S. Lastly, we further examine the extent to which the integrated effect of relative consciousness and reference-group income is related to an individual’s decision that could affect the degree of happiness. We discuss how our results can drive a wedge between choice behavior and happiness maximization and thus between happiness and decision utility.
Publisher	The Institute of Social and Economic Research, Osaka University
Source Title	Institute of Social and Economic Research Discussion Papers
Volume (Issue)	1022
Page	1-41
Date of Issued	2018-03
Language	English
Handle URL	https://hdl.handle.net/11094/67813
Relation.references	URI https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2018/DP1022.pdf
Access Rights	metadata only access
Category	ディスカッション／ワーキング・ペーパー DP/WP
Category	Institute of Social and Economic Research Discussion Papers

Resource Type	technical report
Local Type	DP/WP
DCMI Type	Text
DCTERMS.bibliographicCitation	Institute of Social and Economic Research Discussion Papers. 2018, 1022, p. 1-41
DC.title	How Conscious Are You of Others? Further Evidence on Relative Income and Happiness
DC.creator	Lee, Sun Youn
DC.creator	Ohtake, Fumio
DC.publisher	The Institute of Social and Economic Research, Osaka University
DC.language' scheme='DCTERMS.RFC1766	English
DC.type' scheme='DCTERMS.DCMIType	Text
DCTERMS.issued' scheme='DCTERMS.W3CDTF	2018-03
DC.relation' scheme='DCTERMS.URI	https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2018/DP1022.pdf
DC.subject	Happiness
	relative income
	relative consciousness
	utility
DCTERMS.abstract	Extant research has found that an individual’s happiness is relative with respect to income, suggesting that it rises with own income and falls as the income of a reference group increases. Some recent studies emphasize that the effect of relative income is mediated by the extent to which people compare themselves with others (hereinafter, “relative consciousness”). Using the survey data of representative sample of Japan and the U.S., this paper extends the existing literature by providing a statistical evidence that underlines the importance of the intensity of relative consciousness in association with the perception of reference-group income in determining an individual’s happiness and his/her decision in line with the maximization of the utility. First, we find people who are highly conscious of others’living standards are unhappier in Japan but happier in the U.S. This opposite effect between the two countries is also found to exist when the same estimation is conducted with panel data. Second, the positive relationship between relative consciousness and happiness found in the U.S. results from the perception of reference-group income: highly conscious people compare downward in the U.S. Lastly, we further examine the extent to which the integrated effect of relative consciousness and reference-group income is related to an individual’s decision that could affect the degree of happiness. We discuss how our results can drive a wedge between choice behavior and happiness maximization and thus between happiness and decision utility.
DC.format	67813
citation_title	How Conscious Are You of Others? Further Evidence on Relative Income and Happiness
citation_author	Lee, Sun Youn
citation_author	Ohtake, Fumio
citation_publisher	The Institute of Social and Economic Research, Osaka University
citation_language	English
citation_date	2018-03
citation_journal_title	Institute of Social and Economic Research Discussion Papers
citation_volume	1022
citation_firstpage	1
citation_lastpage	41
citation_public_url	https://hdl.handle.net/11094/67813
citation_abstract_html_url	https://www.iser.osaka-u.ac.jp/static/resources/docs/dp/2018/DP1022.pdf

How Conscious Are You of Others? Further Evidence on Relative Income and Happiness

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