Top incomes and subjective well-being

Abstract

We use data from the World Wealth & Income Database, the European Values Surveys and World Values Surveys to estimate the relationship between income inequality as measured by top income shares and subjective well-being in a sample of 35 countries observed between 1980s and 2010s (139 surveys and more than 200,000 respondents). Results show that top 1% income shares are positively associated with happiness, while that the relationship with life satisfaction is less certain. The positive link between top income shares and happiness is present in a subsample of Western countries. We discuss possible explanations for these findings.