Document Type
Article
Abstract
This paper analyzes the impact of income class on subjective wellbeing. Using rich data from the Gallup World Poll, we investigate whether belonging to locally (both country-and time-specific) defined income classes influences individuals’ life satisfaction. We rely on a latent class analysis estimation method, using individual income proxied by household income divided by household size, as an observable characteristic to hypothesize the income classes. We fit a model with one categorical latent variable with three unobserved groupings, here: income classes, which we interpret as lower, middle and upper classes. Our estimates suggest that individuals in the low and middle income classes are, respectively, about 30 and 17 percent of a standard deviation less likely to report a higher life satisfaction in comparison to individuals belonging to the upper income class. The effect of income classes remains robust to the inclusion of standard explanatory variables in this literature.
Digital Object Identifier (DOI)
Publication Info
Published in Social Sciences, Volume 11, Issue 6, 2022, pages 262-.
Rights
© 2022 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).
APA Citation
Haddad, J., Chaaban, J., Chalak, A., & Ghattas, H. (2022). Does Income Class Affect Life Satisfaction? New Evidence from Cross-Country Microdata. Social Sciences, 11(6), 262.https://doi.org/10.3390/socsci11060262