Relative income, happiness, and utility : an explanation for the Easterlin paradox and other puzzles

The well-known Easterlin paradox points out that average happiness has remained constant over time despite sharp rises in GNP per head. At the same time, a micro literature has typically found positive correlations between individual income and individual measures of subjective well-being. This paper suggests that these two findings are consistent with the presence of relative income terms in the utility function. Income may be evaluated relative to others (social comparison) or to oneself in the past (habituation). We review the evidence on relative income from the subjective well-being literature. We also discuss the relation (or not) between happiness and utility, and discuss some nonhappiness research (behavioral, experimental, neurological) related to income comparisons. We last consider how relative income in the utility function can affect economic models of behavior in the domains of consumption, investment, economic growth, savings, taxation, labor supply, wages, and migration.

The causal effect of income on health: Evidence from German reunification

We investigate whether therewas a causal effect of income changes on the health satisfaction of East and West Germans in the years following reunification. Our data source is the German Socio-Economic Panel (GSOEP) between 1984 and 2002, and we fit a recently proposed fixed-effects ordinal estimator to our health measures and use a causal decomposition technique to account for panel attrition.We find evidence of a significant positive effect of income changes on health satisfaction, but the quantitative size of this effect is small. This is the case with respect to current income and a measure of ‘permanent’ income.

Thermal analysis and hot stage Raman spectroscopy of the basic copper arsenate mineral : euchroite

The thermal analysis of euchroite shows two mass loss steps in the temperature range 100 to 105°C and 185 to 205°C. These mass loss steps are attributed to dehydration and dehydroxylation of the mineral. Hot stage Raman spectroscopy (HSRS) has been used to study the thermal stability of the mineral euchroite, a mineral involved in a complex set of equilibria between the copper hydroxy arsenates: euchroite Cu2(AsO4)(OH).3H2O → olivenite Cu2(AsO4)(OH) → strashimirite Cu8(AsO4)4(OH)4.5H2O → arhbarite Cu2Mg(AsO4)(OH)3. Hot stage Raman spectroscopy inolves the collection of Raman spectra as a function of the temperature. HSRS shows that the mineral euchroite decomposes between 125 and 175 °C with the loss of water. At 125 °C, Raman bands are observed at 858 cm-1 assigned to the ν1 AsO43- symmetric stretching vibration and 801, 822 and 871 cm-1 assigned to the ν3 AsO43- (A1) antisymmetric stretching vibration. A distinct band shift is observed upon heating to 275 °C. At 275 °C the four Raman bands are resolved at 762, 810, 837 and 862 cm-1. Further heating results in the diminution of the intensity in the Raman spectra and this is attributed to sublimation of the arsenate mineral. Hot stage Raman spectroscopy is most useful technique for studying the thermal stability of minerals especially when only very small amounts of mineral are available.

Structure of selected basic copper (II) sulphate minerals based upon spectroscopy : implications for hydrogen bonding

The application of near-infrared and infrared spectroscopy has been used for identification and distinction of basic Cu-sulphates that include devilline, chalcoalumite and caledonite. Near-infrared spectra of copper sulphate minerals confirm copper in divalent state. Jahn-Teller effect is more significant in chalcoalumite where 2B1g ® 2B2g transition band shows a larger splitting (490 cm-1) confirming more distorted octahedral coordination of Cu2+ ion. One symmetrical band at 5145 cm-1 with shoulder band 5715 cm-1 result from the absorbed molecular water in the copper complexes are the combinations of OH vibrations of H2O. One sharp band at around 3400 cm-1 in IR common to the three complexes is evidenced by Cu-OH vibrations. The strong absorptions observed at 1685 and 1620 cm-1 for water bending modes in two species confirm strong hydrogen bonding in devilline and chalcoalumite. The multiple bands in v3 and v4(SO4)2- stretching regions are attributed to the reduction of symmetry to the sulphate ion from Td to C2V. Chalcoalumite, the excellent IR absorber over the range 3800-500 cm-1 is treated as most efficient heat insulator among the Cu-sulphate complexes.

International comparisons of Malaysian construction labour productivity

Productivity is basic statistical information for many international comparisons and country performance assessments. This study estimates the construction labour productivity of 79 selected economies. The real (purchasing power parities converted) and nominal construction expenditure from the Report of 2005 International Comparison Programme published by the World Bank and construction employment from the database of labour statistics (LABORSTA) operated by the Bureau of Statistics of International Labour Organization were used in the estimation. The inference statistics indicate that the descending order of nominal construction labour productivity from high income economies to low income economies is not established. The average construction labour productivity of low income economies is higher than middle income economies when the productivity calculation uses purchasing power parities converted data. Malaysia ranked 50th and 63rd position among the 79 selected economies on real and nominal measurement respectively.

Persistence of income inequality : does child mortality matter?

Many developing countries are afflicted by persistent inequality in the distribution of income. While a growing body of literature emphasizes differential fertility as a channel through which income inequality persists, this paper investigates differential child mortality – differences in the incidence of child mortality across socioeconomic groups – as a critical link in this regard. Using evidence from cross-country data to evaluate this linkage, we find that differential child mortality serves as a stronger channel than differential fertility in the transmission of income inequality over time. We use random effects and generalized estimating equations techniques to account for temporal correlation within countries. The results are robust to the use of an alternate definition of fertility that reflects parental preference for children instead of realized fertility.

On inequality tax evasion and progressive taxes

This paper proposes a simple variation of the Allingham and Sandmo (1972) construct and integrates it to a dynamic general equilibrium framework with heterogeneous agents. We study an overlapping generations framework i n which agents must initially decide whether to evade taxes or not. In the event they decide to evade, they then have to decide the extent of income or wealth they wish to under-report. We find that in comparison with the basic approach, the ‘evade or not’ choice drastically reduced the extent of evasion in the economy. This outcome is the result of an anomaly intrinsic to the basic Allingham and Sandmo version of the model, which makes the evade-or-not extension a more suitable approach to modelling the issue. We also find that the basic model, and the model with and ‘evade-or-not’ choice have strikingly different political economy implications, , which suggest fruitful avenues of empirical research.

Interaction of NPR1 with basic leucine zipper protein transcription factors that bind sequences required for salicylic acid induction of the PR–1 gene

The Arabidopsis thaliana NPR1 has been shown to be a key regulator of gene expression during the onset of a plant disease-resistance response known as systemic acquired resistance. The npr1 mutant plants fail to respond to systemic acquired resistance-inducing signals such as salicylic acid (SA), or express SA-induced pathogenesis-related (PR) genes. Using NPR1 as bait in a yeast two-hybrid screen, we identified a subclass of transcription factors in the basic leucine zipper protein family (AHBP-1b and TGA6) and showed that they interact specifically in yeast and in vitro with NPR1. Point mutations that abolish the NPR1 function in A. thaliana also impair the interactions between NPR1 and the transcription factors in the yeast two-hybrid assay. Furthermore, a gel mobility shift assay showed that the purified transcription factor protein, AHBP-1b, binds specifically to an SA-responsive promoter element of the A. thaliana PR-1 gene. These data suggest that NPR1 may regulate PR-1 gene expression by interacting with a subclass of basic leucine zipper protein transcription factors.