This paper analyses the relation between air quality and subjective well-being in Germany. Life Satisfaction (LS) data from the German Socio-Economic Panel Study (SOEP) is connected with daily county pollution in terms of carbon monoxide (CO), nitrogen dioxide (NO2) and ozone (O3) from 1998 to 2008. The assumed microeconometric happiness function is estimated considering individual time invariant effects. It is observed that O3 has a significant negative impact on life satisfaction. The estimated influence of current CO as well as NO2 is not significant. Moreover, I found that LS of people with environmental worries is more affected by ozone pollution. This was not the case for people with a bad health status. Using the marginal rate of substitution between income and air pollution, it is calculated that an increase of one µg/m 3 in daily average county O3 has to be compensated by an increase of e 11.33 in monthly net household income to hold an average individual's LS constant.
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SOEPpapers on Multidisciplinary Panel Data Research at DIW BerlinThis series presents research findings based either directly on data from the German SocioEconomic Panel Study (SOEP) or using SOEP data as part of an internationally comparable data set (e.g. CNEF, ECHP, LIS, LWS, CHER/PACO). SOEP is a truly multidisciplinary household panel study covering a wide range of social and behavioral sciences: economics, sociology, psychology, survey methodology, econometrics and applied statistics, educational science, political science, public health, behavioral genetics, demography, geography, and sport science.The decision to publish a submission in SOEPpapers is made by a board of editors chosen by the DIW Berlin to represent the wide range of disciplines covered by SOEP. There is no external referee process and papers are either accepted or rejected without revision. Papers appear in this series as works in progress and may also appear elsewhere. They often represent preliminary studies and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be requested from the author directly.Any opinions expressed in this series are those of the author(s) and not those of DIW Berlin.Research disseminated by DIW Berlin may include views on public policy issues, but the institute itself takes no institutional policy positions.
AbstractThis paper analyses the relation between air quality and subjective well-being in Germany. Life Satisfaction (LS) data from the German Socio-Economic Panel Study (SOEP) is connected with daily county pollution in terms of carbon monoxide (CO), nitrogen dioxide (NO2) and ozone (O3) from 1998 to 2008. The assumed microeconometric happiness function is estimated considering individual time invariant effects. It is observed that O3 has a significant negative impact on life satisfaction. The estimated influence of current CO as well as NO2 is not significant. Moreover, I found that LS of people with environmental worries is more affected by ozone pollution. This was not the case for people with a bad health status. Using the marginal rate of substitution between income and air pollution, it is calculated that an increase of one µg/m 3 in daily average county O3 has to be compensated by an increase of e 11.33 in monthly net household income to hold an average individual's LS constant.
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