Abstract:
This paper asks how income distribution affects individual well-being and tries to explore the idea that this relation depends on the degree of mobility and uncertainty in the economy. It mostly concentrates on the relation between satisfaction and reference income (defined as the income of one's professional peers), and hinges on the micro-econometric analysis of household survey data (mostly panel), including subjective attitudinal questions. Using over one million observations, it uncovers a divide between old -low mobility- European countries versus new European post-Transition countries and the United States. Whereas jealousy is dominant in the former, ambition is even stronger in the latter.
