TY  - JOUR
AU  - Wolfers,Justin
TI  - Is Business Cycle Volatility Costly? Evidence from Surveys of Subjective Wellbeing
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9619
PY  - 2003
Y2  - April 2003
UR  - http://www.nber.org/papers/w9619
L1  - http://www.nber.org/papers/w9619.pdf
N1  - Author contact info:
Justin Wolfers
Business and Public Policy Department
Wharton School, University of Pennsylvania
3620 Locust Walk
Room 1456 Steinberg-Deitrich Hall
Philadelphia, PA 19104-6372
Tel: (215) 898-3013
Fax: (215) 898-7635
E-Mail: jwolfers@wharton.upenn.edu
AB  - This paper analyzes the effects of business cycle volatility on measures of subjective well-being, including self-reported happiness and life satisfaction. I find robust evidence that high inflation and, to a greater extent, unemployment lower perceived well-being. Greater macroeconomic volatility also undermines well-being. These effects are moderate but important: eliminating unemployment volatility would raise well-being by an amount roughly equal to that from lowering the average level of unemployment by a quarter of a percentage point. The effects of inflation volatility on well-being are less easy to detect and are likely smaller.
ER  -