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Unmet aspirations as an explanation for the age u-shape in human wellbeing

Schwandt, Hannes (2013) Unmet aspirations as an explanation for the age u-shape in human wellbeing. CEP Discussion Papers (CEPDP1229). Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

A large literature in behavioral and social sciences has found that human wellbeing follows a U-shape over age. Some theories have assumed that the U-shape is caused by unmet expectations that are felt painfully in midlife but beneficially abandoned and experienced with less regret during old age. In a unique panel of 132,609 life satisfaction expectations matched to subsequent realizations, I find people to err systematically in predicting their life satisfaction over the life cycle. They expect -- incorrectly -- increases in young adulthood and decreases during old age. These errors are large, ranging from 9.8% at age 21 to -4.5% at age 68, they are stable over time and observed across socio-economic groups. These findings support theories that unmet expectations drive the age U-shape in wellbeing.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk/_new/publications/series.asp?...
Additional Information: © 2013 The Author
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HV Social pathology. Social and public welfare. Criminology
JEL classification: A - General Economics and Teaching > A1 - General Economics > A12 - Relation of Economics to Other Disciplines
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D84 - Expectations; Speculations
I - Health, Education, and Welfare > I3 - Welfare and Poverty > I30 - General
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 08 Aug 2013 11:56
Last Modified: 20 Feb 2019 03:42
URI: http://eprints.lse.ac.uk/id/eprint/51571

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