Income, aspirations and subjective well-being: International evidence

Previous micro-level results from cross-sectional data from individual countries suggest that well-being brought about by higher income are at least partly offset by higher in -come aspirations. We conduct an encompassing analysis, covering about 30 countries at different stages of economic development. We use micro-data on Europeans' subjective well-being, income and aspirations from the year 2013 and panel data on income and aspirations. Earlier findings on the negative association of aspirations and well-being are shown to hold internationally. As suggested by the earlier results from individual coun-tries, aspirations matter systematically more in high-income countries. These results are robust to alternative well-being measures. However, the results also suggest that, despite aspirations, higher income improves life satisfaction even in high-income countries where aspirations totally offset emotional well-being and eudaimonia improvements. Further, the panel analysis shows that aspirations increase with incomes. Taken together, our results suggest that aspirations dampen income-induced well-being improvements, especially in high-income countries. (c) 2021 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license ( http://creativecommons.org/licenses/by-nc-nd/4.0/ )

Automated summary

The study found that aspirations have a negative impact on well-being, especially in high-income countries. Despite aspirations offsetting some of the well-being brought about by income, higher income still improves life satisfaction for individuals.