Distributional Dynamics of Life Satisfaction in Europe

The promotion of subjective well-being is becoming a central goal of social and public policy. In this regard, it is sometimes argued that subjective well-being inequality is an informative indicator of social tensions. In this paper, we investigate the evolution of the life satisfaction distribution in Europe since 1973 using data from the Eurobarometer surveys. In order to respect the ordinal nature of subjective well-being and to avoid the need to impose an arbitrary scale, we use the Abul Naga and Yalcin index. We demonstrate that this index can be characterised as a measure of both inequality and polarisation, depending on the value of the parameters. We find that, at the European level, life satisfaction inequality was significantly higher in 2014 than in 1995. This result is mainly explained by the increase in inequality in the Mediterranean countries and Ireland in recent years, but especially since the Great Recession. Although polarisation and inequality present a similar trend at the European level, some differing patterns are observed for particular countries, thus suggesting that these two phenomena are not only conceptually different, but also complementary in the analysis of the distribution of subjective well-being.The authors acknowledge the financial support of the Ministerio de Economía y Competitividad (project ECO2016-76203-C2-1-P). We are also grateful to José Manuel Alonso, Jacques Silber, Martyna Kobus, and participants of the XXII Meeting of Public Economics and the Sixth ECINEQ meeting for their valuable comments. We also thank the editor and two anonymous referees for their helpful comments and suggestions