Piper, A (Cover date: June 2023) What Does Dynamic Panel Analysis Tell Us About Life Satisfaction? Review of Income and Wealth, 69 (2). 376 -394. ISSN 0034-6586
Abstract
Static fixed effects estimation of life satisfaction often gives rise to serial correlation in the residuals, indicating omitted dynamics. Rather than correcting the standard errors, “to make them robust,” this study explores dynamic panel analysis to incorporate the otherwise omitted dynamics into the estimation of life satisfaction models. The analysis utilizes the System General Method of Moments approach to dynamic analysis. The results indicate that overall life satisfaction is largely (though not wholly) contemporaneous; correspondingly, the persistence of satisfaction from previous periods is limited. This finding is robust to a variety of different specification choices. Accordingly, the issue of omitted dynamics in a life satisfaction context is a minor one. This use of dynamic panel analysis, therefore, offers support for the ongoing use of static models (like fixed effects), even though they omit dynamics. Given the highlighted challenges of dynamic panel analysis, static fixed effects analyses will often be preferred.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2022 The Authors. Review of Income and Wealth published by John Wiley & Sons Ltd on behalf of International Association for Research in Income and Wealth. This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits use and distribution in any medium, provided the original work is properly cited, the use is non-commercial and no modifications or adaptations are made. |
Keywords: | life satisfaction, dynamic panel analysis, general method of moments, happiness, subjective well-being |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Economics Division (LUBS) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 27 Apr 2022 13:21 |
Last Modified: | 20 Nov 2023 16:20 |
Status: | Published |
Publisher: | Wiley |
Identification Number: | 10.1111/roiw.12567 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:186165 |