Abstract
A plethora of research shows that income is an important factor in adult’s life satisfaction, but research ascertaining its importance for children’s life satisfaction is scant. Using a largescale nationally representative longitudinal survey with children aged 10–15, we estimate comprehensive life satisfaction models that account for heterogeneity in exogenous circumstances in children’s lives, focussing on family income and material deprivation. We find empirical support for the hypothesis that children are more satisfied with their lives, the more income their family has and the less material deprivation they experience throughout their teens. There are, however, differences across age groups with children aged 12–15 experiencing greater life satisfaction losses on account of lower family material wellbeing than younger children. Overall, income effects for older children are small but statistically significant when accounting for unobserved individual differences.
Highlights
Following recommendations by world-leading economic advisors (e.g., Stiglitz et al, 2010), governments worldwide are looking to increase national wellbeing
From the perspective of adult-focused life satisfaction research, this paper explores whether contemporaneous factors associated with adult life satisfaction are associated with life satisfaction in children, focusing mainly on income, which is among the most-researched factors in adult life satisfaction (e.g., Ambrey & Fleming, 2014; Biswas-Diener, 2008; Caporale et al, 2009; Cheung & Lucas, 2015; Dolan et al, 2008; Frijters et al, 2004)
Children experienced a considerable degree of change in household income over the observation period, with 74.2 to 41.2 of them moving from one decile of the income distribution to another decile within a year
Summary
Following recommendations by world-leading economic advisors (e.g., Stiglitz et al, 2010), governments worldwide are looking to increase national wellbeing. What is important for life satisfaction, and how can government affect it? Married people are more satisfied with life than never-married singles, divorcees (including those living in separation), and widowers (e.g., Shapiro & Keyes, 2008). G. Knies a religion are more satisfied (Lim & Putnam, 2010), and poor health is a significant factor in explaining lower life satisfaction (Diener et al, 1999). Satisfied people live longer and healthier lives (Diener & Chan, 2011). Life satisfaction is a desirable outcome for persons at all stages of the lifecycle and for policymakers aiming to create policies that deliver the greatest happiness to all (Frijters et al, 2020; Kahneman & Sugden, 2005; Layard, 2005)
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