Happiness and the role of social protection: how types of social spending affected individuals’ life satisfaction in OECD countries, 1980–2012

Abstract

The growing literature on individual determinants of subjective well-being has given little attention to political factors. This paper considers the welfare state, and how social expenditure affects individuals’ self-reported life satisfaction. The statistical analysis uses indicators of subjective well-being, reflecting individuals from OECD-countries between 1980 and 2012, with data gathered from the Eurobarometer and the World Values Survey - which are analysed in comparison. The results suggest that social spending should be studied in terms of underlying branches when addressing its implications. The results find social spending to be uncorrelated with levels of subjective well-being when considered in terms of total levels. When considered as types of spending however, a majority of the elements are found to have significant impacts. The findings show mixed results among the two data sets; however, important similarities are found in the way social spending related to health care and poverty are having positive impacts, and spending associated with unemployment and labour market programmes have negative impacts. As the correlations of the underlying elements affect life satisfaction in different directions, total social spending appears to be uncorrelated with subjective well-being, although the true impact depends on which socialpolicies are being promoted through such spending.

Welfare systems and mental health in OECD and EEA countries: a scoping review

“…Mental health by social expenditure Mental wellbeing. Concerning the positive aspects of mental health, studies examined the relationship between social expenditure and life satisfaction (Clench-Aas and Holte, 2018;Nordheim and Martinussen, 2019;Dumbraveanu, 2015;Flavin et al, 2011;Hessami, 2010;Knoll and Pitlik, 2016) happiness (Ono and Lee, 2013) and wellbeing (Cresswell-Smith, 2022). Overall, the evidence offers support for the positive link between higher social expenditure and mental well-being, with positive relationships reported in six studies (Clench-Aas and Holte, 2018;Cresswell-Smith, 2022;Dumbraveanu, 2015;Flavin et al, 2011;Hessami, 2010;Nordheim and Martinussen, 2019), negative effects were reported in one paper (Knoll and Pitlik, 2016) and one study described a more controversial picture (Ono and Lee, 2013).…”

“…More specifically, a key mechanism through which welfare systems could mitigate the negative effects of social inequality on mental health may be their ability to prevent the least advantaged in the population to fall under a critical socioeconomic threshold (Levecque et al, 2011;Niedzwiedz et al, 2014Niedzwiedz et al, , 2015Samuel and Hadjar, 2016). This is also supported by the evidence that higher social expenditure also seems to be linked to better mental health when targeting the least advantaged and when they are successful in reducing social inequalities (Baumbach and Gulis, 2014;Hessami, 2010;Nordheim and Martinussen, 2019;Yur'yev, 2012).…”

Bigger or better? The effect of public spending on happiness in Africa

“…Higher government spending in areas such as education, health and development could lead to higher living standards, which means higher levels of happiness (Ciziceno & Pizzuto, 2022; Delgado‐Rodríguez & De Lucas‐Santos, 2022; Eklou & Fall, 2020; Flavin, 2019; O'Connor, 2017; Ott, 2015). However, a decrease in public spending could imply that the government applies a lower tax rate, which could stimulate economic growth that can also lead to an increase in the standard of living in the country (Bjørnskov et al, 2007; Knoll & Pitlik, 2016; Nordheim & Martinussen, 2020; Ott, 2005; Yamamura, 2011). In contrast, Kacapyr (2008) indicates no significant association between happiness and public spending, while Perovic and Golem (2010) suggest that public spending and happiness have a nonlinear relationship.…”

“…From the above, the main question of this study is: does public spending improve the happiness of African populations? Several studies that have analyzed this question have taken a microeconomic approach, focusing on individual well‐being (Eklou & Fall, 2020; Flavin, 2019; Nordheim & Martinussen, 2020). Moreover, these studies have done little to investigate the mechanisms by which government spending affects happiness.…”

Aging well? Social spending, age, and subjective wellbeing across Europe

“…Social spending is a key component of welfare policy and is primarily implemented to enhance population wellbeing, since it offers insurance in the form of social assistance and financial contributions to people or households in need (Nordheim and Martinussen 2019). "Such insurance provides social assistance and financial contributions to individuals or households experiencing difficulties, where such arrangements are related to a range of social protection programmes associated with poverty, unemployment and labour market, pensions and old age support, family and child care, health and longterm care, housing, as well as support, facilitation and income maintenance for sick or disabled individuals" (ibid: 4).…”