Subjective Well-Being and Income: Is There Any Evidence of Satiation?

Stevenson, Betsey; Wolfers, Justin

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Subjective Well-Being and Income: Is There Any Evidence of Satiation?

NBER Working Paper No. w18992

25 Pages Posted: 28 Apr 2013 Last revised: 25 May 2023

See all articles by Betsey Stevenson

University of Michigan at Ann Arbor - Department of Economics; University of Michigan at Ann Arbor - Gerald R. Ford School of Public Policy; The University of Sydney - Discipline of Economics; Brookings Institution - Economic Studies Program; Peterson Institute for International Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Kiel Institute for the World Economy

There are 4 versions of this paper

Date Written: April 2013

Abstract

Many scholars have argued that once "basic needs" have been met, higher income is no longer associated with higher in subjective well-being. We assess the validity of this claim in comparisons of both rich and poor countries, and also of rich and poor people within a country. Analyzing multiple datasets, multiple definitions of "basic needs" and multiple questions about well-being, we find no support for this claim. The relationship between well-being and income is roughly linear-log and does not diminish as incomes rise. If there is a satiation point, we are yet to reach it.

Suggested Citation: Suggested Citation

Stevenson, Betsey and Wolfers, Justin, Subjective Well-Being and Income: Is There Any Evidence of Satiation? (April 2013). NBER Working Paper No. w18992, Available at SSRN: https://ssrn.com/abstract=2257182