Adaptation to Poverty in Long-Run Panel Data

Andrew E. Clark; Conchita D’Ambrosio; Simone Ghislandi

doi:10.1162/rest_a_00544

The Review of Economics and Statistics Vol. 98 No. 3 2016

Adaptation to Poverty in Long-Run Panel Data

Andrew E. Clark^1,2,3; Conchita D’Ambrosio⁴; Simone Ghislandi^5,6

¹ Centre National de la Recherche Scientifique · ² IZA - Institute of Labor Economics · ³ Paris School of Economics · ⁴ University of Luxembourg · ⁵ Policy Analysis (United States) · ⁶ Bocconi University

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Abstract

We consider the link between poverty and subjective wellbeing and focus in particular on potential adaptation to poverty. We use panel data on almost 54,000 individuals living in Germany from 1985 to 2012 to show, first, that life satisfaction falls with both the incidence and intensity of contemporaneous poverty. We then reveal that there is little evidence of adaptation within a poverty spell: poverty starts bad and stays bad in terms of subjective well-being. We cannot identify any cause of poverty entry that explains the overall lack of poverty adaptation.

DOI: 10.1162/rest_a_00544
Volume: 98
Issue: 3
Pages: 591-600
Language: en
Sources: semanticscholar openalex crossref

Adaptation to Poverty in Long-Run Panel Data

Abstract

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