Short-run and long-run causalities between happiness, income and unemployment in Japan

Abstract

This article examines the short-run and long-run causal interactions between happiness and two economic variables in Japan, namely, unemployment and income. Results suggest that whilst more rapid economic growth and lower levels of unemployment are important in raising people’s well-being in the short run, it is the relative growth performance of the economy that matters in the long run.

Keywords:

• causality
• happiness
• growth
• income
• unemployment

JEL Classification:

• I31

Notes

¹ Note that there is a missing observation for the average life satisfaction variable for year 2000. This missing observation is replaced by the average of the average life satisfaction in years 1999 and 2000.