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Journal Articles Economies et Sociétés. Série AF, Histoire Economique Quantitative Year : 2014

Evolutionary efficiency and distributive effects of inertia in cross-country life-satisfaction

Tapas Mishra
  • Function : Correspondent author
Mamata Parhi
  • Function : Author
Claude Diebolt

Abstract

This paper is broadly concerned with understanding the role of evolutionary efficiency in happiness realization. Towards this end, we examine the (distributive and) non-linear effects of inertia in a cross-country setting. We develop a general model of happiness inertia and study its properties in a stochastic and non-linear environment. This allows us to map out the net effects of evolutionary efficiency through ’adaptive capability’ in an environment where stochastic shocks are both mean reverting and non mean-reverting. Our empirical estimation for a set of developed economies demonstrate that the adjustment of realized happiness to a stochastic non-mean reverting shock is non-linear implying the involvement of complex socio-economic processes in happiness perception. Moreover, we also find that the adjustment of current level of happiness to the past follows a heterogeneous distribution once again indicating that the extent of temporal (inter-)dependence is non-unique across the happiness distribution. Our results hold interesting policy implications.
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hal-01741858 , version 1 (23-03-2018)

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  • HAL Id : hal-01741858 , version 1

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Tapas Mishra, Mamata Parhi, Claude Diebolt. Evolutionary efficiency and distributive effects of inertia in cross-country life-satisfaction. Economies et Sociétés. Série AF, Histoire Economique Quantitative, 2014, 49, pp.1335-1356. ⟨hal-01741858⟩
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