Abstract
In recent years, there has been growing interest in the health implications of rising gasoline prices. This paper considers the impact of gasoline prices on subjective well-being, as captured by survey questions on happiness and life satisfaction. Using rich data from the DDB Worldwide Communications Life Style™ survey, we document a negative relationship between gasoline prices and self-reported life satisfaction over the period 1985-2005. The estimated reduction in well-being, moreover, is found to be nearly twice as large among groups of likely car owners. Interestingly, although rising gasoline prices lead to an immediate deterioration in subjective well-being, analyses of lagged prices suggest that well-being almost fully rebounds 1. year later and changes very little each year thereafter. Our contemporaneous estimates imply that rising gasoline prices generate well-being losses comparable to faltering labor market conditions, and likely offset some of the physical health benefits found in previous research.
Original language | English (US) |
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Pages (from-to) | 160-175 |
Number of pages | 16 |
Journal | Journal of Urban Economics |
Volume | 72 |
Issue number | 2-3 |
DOIs | |
State | Published - Sep 2012 |
Keywords
- Gasoline prices
- Happiness
- Health
- Subjective well-being
ASJC Scopus subject areas
- Economics and Econometrics
- Urban Studies