Hedonic Capital

Liam Graham () and Andrew Oswald
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Liam Graham: University College London

No 2079, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper proposes a new way to think about happiness. It distinguishes between stocks and flows. Central to the analysis is a concept we call ‘hedonic capital’. The paper sets out a model of the dynamics of wellbeing in which bad life-shocks are smoothed by the drawing down of hedonic capital. The model fits the patterns found in the empirical literature: the existence of a stable level of wellbeing and a tendency to return gradually towards that level. It offers a theory of hedonic adaptation.

Keywords: adaptation; wellbeing; evolution; happiness; habituation (search for similar items in EconPapers)
JEL-codes: D1 I3 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2006-04
New Economics Papers: this item is included in nep-hpe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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https://docs.iza.org/dp2079.pdf (application/pdf)

Related works:
Working Paper: Hedonic Capital (2006)
Working Paper: Hedonic Capital (2006)
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