The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data

Jan-Emmanuel De Neve; George Ward; Femke De Keulenaer; Bert Van Landeghem; Georgios Kavetsos; Michael I. Norton

doi:10.1162/rest_a_00697

The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data

Jan-Emmanuel De Neve¹; George Ward²; Femke De Keulenaer³; Bert Van Landeghem⁴; Georgios Kavetsos⁵; Michael I. Norton⁶

¹ University of Oxford · ² MIT and Centre for Economic Performance · ³ IPSOS · ⁴ University of Sheffield, Maastricht University, and IZA · ⁵ Queen Mary University of London and Centre for Economic Performance · ⁶ Harvard Business School

The Review of Economics and Statistics 2018 open access

Are individuals more sensitive to losses than gains in terms of economic growth? We find that measures of subjective well-being are more than twice as sensitive to negative as compared to positive economic growth. We use Gallup World Poll data from over 150 countries, BRFSS data on 2.3 million US respondents, and Eurobarometer data that cover multiple business cycles over four decades. This research provides a new perspective on the welfare cost of business cycles, with implications for growth policy and the nature of the long-run relationship between GDP and subjective well-being.

DOI: 10.1162/rest_a_00697
Volume: 100 (2)
Pages: 362-375
Language: en
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