Abstract
The purpose of this paper is to examine the well-being dynamics across European countries during the Great Recession and to investigate the potential role of the quality of formal institutions in mitigating the negative effect of the economic downturn. This study uses the club convergence methodology by Phillips and Sul (2007; 2009) to group EU-28 countries that present similar features in terms of well-being during the period 2005-2017. The study also applies probit models to investigate the potential role of several social and institutional characteristics that are supposed to affect subjective well-being levels. The results show the existence of a “well-being gap” among European countries. The economic downturn started in 2008 has impacted the perceived well-being more in low-income and low-growth countries (less developed transition and Southern countries), than in high-income and more developed transition countries. The study also shows that countries that present well-functioning institutional systems and, more in general, good institutional performances show higher life satisfaction levels and tend to be more resilient to the negative effects generated by the economic shock.
Highlights
The political reforms introduced over the last decades have gradually attenuated disparities between transition and advanced countries with advisable improvements in the macroeconomic conditions both in less developed areas of Europe (Gruen and Klasen, 2012) and in the postcommunist countries (Iwanicz-Drozdowska et al, 2016; Blokker, 2005).the global financial crisis of 2008 has slowed down the difficult process of convergence among European countries (Bolea et al, 2018; Kelley and Evans, 2017; Mazzola and Pizzuto, 2020)
The purpose of this paper is to examine the well-being dynamics across European countries during the Great Recession and to investigate the potential role of the quality of formal institutions in mitigating the negative effect of the economic downturn
The study shows that countries that present well-functioning institutional systems and, more in general, good institutional performances show higher life satisfaction levels and tend to be more resilient to the negative effects generated by the economic shock
Summary
The global financial crisis of 2008 has slowed down the difficult process of convergence among European countries (Bolea et al, 2018; Kelley and Evans, 2017; Mazzola and Pizzuto, 2020). Previous studies (see for example, Welsch and Bonn (2008) and Djankov et al (2016)) have suggested a possible association between economic and well-being convergence in the European context, but the reason why some countries appear to be more resilient to crises than others - in terms of subjective wellbeing - is still unsolved. We analyze life satisfaction data from 2005 to 2017 in order to understand whether - or not - the subjective well-being in transition countries converges to the levels of other EU members, and, to what extent this process may depend on institutional, social or economic conditions
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
