Subjective Well-Being Around Retirement

Marzieh Abolhassani, Rob Alessie*

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

12 Citations (Scopus)

Abstract

This paper studies the effect of both retirement and unemployment on life satisfaction, using subjective satisfaction indicators from the German Socio-Economic Panel. Moreover, we analyze how accurate individuals anticipate changes in satisfaction around retirement, as well as the correlation between the forecast error in life satisfaction and the labor market status. Being unemployed has a significant negative effect on life satisfaction; (in)voluntary retirement on the other hand has no significant effect on life satisfaction. A new finding is that unemployed individuals underestimate future life satisfaction. That is, their current labor market status has temporary negative effects on well-being, but, after 5 years, individuals are happier with their life than previously anticipated. We find no effects of (in)voluntary retirement on the forecast error.

Original languageEnglish
Pages (from-to)349-366
Number of pages18
JournalEconomist-Netherlands
Volume161
Issue number3
DOIs
Publication statusPublished - Sep-2013

Keywords

  • Subjective well-being
  • Retirement
  • Panel data
  • Forecast error
  • LIFE SATISFACTION
  • PANEL-DATA
  • HAPPINESS
  • MODELS

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