Income Inequality and Happiness: An Inverted U-Shaped Curve.

ABSTRACT: Numerous studies agree that income inequality, rather than absolute income, is an important predictor of happiness. However, its specific role has been controversial. We argue that income inequality and happiness should exhibit an inverted U-shaped relationship due to the dynamic competing process between two effects: when income inequality is relatively low, the signal effect will be the dominating factor, in which individuals feel happy because they consider income inequality as a signal of social mobility and expect upward mobility; however, if income inequality level increases beyond a critical point, the jealousy effect will become the dominating factor, in which individuals tend to be unhappy because they are disillusioned about the prospect of upward mobility and jealo

SUBMITTER: Yu Z 

PROVIDER: S-EPMC5705943 | biostudies-literature | 2017

REPOSITORIES: biostudies-literature