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Consumption Theories and Consumers' Assessments of Subjective Well‐Being
Author(s) -
MACDONALD MAURICE,
DOUTHITT ROBIN A.
Publication year - 1992
Publication title -
journal of consumer affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.582
H-Index - 62
eISSN - 1745-6606
pISSN - 0022-0078
DOI - 10.1111/j.1745-6606.1992.tb00026.x
Subject(s) - presumption , consumption (sociology) , economics , variance (accounting) , permanent income hypothesis , life satisfaction , econometrics , life cycle hypothesis , psychology , public economics , social psychology , macroeconomics , sociology , social science , accounting , political science , law
The purpose of this research is to examine the relationship between psychological well‐being and objective, economic well‐being as measured using three different economic theories of consumption behavior. The theories examined are the life cycle income hypothesis, the relative income hypothesis, and a resource deficit hypothesis. The results from analyses of the Wisconsin Basic Needs Study data demonstrate the importance of careful economic variable construction and support the economic presumption that income and life satisfaction are positively related. The relative income hypothesis model accounts for the greatest explained variance and is also superior in that it is easier to specify.