Does Happiness Adapt? A Longitudinal Study of Disability with Implications for Economists and Judges

By Andrew J. Oswald, Nattavudh Powdthavee. Social Science Research Network, 2008

633 citations recorded by the source corpus.

Economics ignores the possibility of hedonic adaptation (the idea that people bounce back from utility shocks). This paper argues that economists are wrong to do so. It provides longitudinal evidence that individuals who become disabled go on to exhibit recovery in mental wellbeing. Adaptation to severe disability, however, is shown to be incomplete. The paper suggests ways to calculate the level of compensatory damages for the pain and suffering from disablement. Courts all over the world currently use ad hoc methods.

Subfields: Accounting, Demography, Social Psychology

View Paper: https://www.semanticscholar.org/paper/ca76e1e3052d642867b1170a415b8556e6bc42fc

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Citations in the corpus

Leisure Time, Leisure Activities, and Happiness in China (2015, background): “Across the research camps, the finding explored by economists was somewhat fully explained by psychologists who typically view the impact of material conditions on well-being as being adjusted by “adaptation processes” (Oswald & Powdthavee, 2008).”
E pluribus unum? A critical survey of job quality indicators (2011, background): “For example, the literature on subjective well-being emphasizes the impact of the differential ability of people to cope and adapt to happiness (Diener et al., 1999; Oswald and Powdthavee, 2008).”
Income and happiness: Evidence, explanations and economic implications (2006, background): “More recent examples of adaptation in non-monetary spheres are Lucas et al. (2003) and Lucas (2005) with respect to marriage and divorce, Wu (2001) and Oswald and Powdthavee (2005) for adaptation to illness or disability, and Lucas et al. (2004) regarding unemployment.”
Life satisfaction and self-employment: a matching approach (2010, background): “These effects are robust in panel studies that control for selection effects, i.e. the relationship is not due to unhappy individuals that self-select into unemployment (Winkelmann and Winkelmann, 1998; Lucas et al., 2004; Oswald and Powdthavee, 2008).”
A test for the convexity of human well-being over the life cycle: Longitudinal evidence from a 20-year panel (2011, neutral): “…has been found both for developed countries (Blanchflower and Oswald, 2004; Clark and Oswald, 1996; Di Tella et al., 2001, 2003; Oswald, 1994; Oswald and Powdthavee, 2007, 2008a,b; Winkelmann and Winkelmann, 1998), as well as for transitioning and developing countries (Fafchamps and Shilpi,…”
Advances and Open Questions in the Science of Subjective Well-Being (2018, positive): “A mathematical formulation of this theory was offered by Parducci (1995). Easterlin (1974) explained the previously mentioned “Easterlin Paradox” through these relative-income effects.”
Happiness Adaptation to Income and to Status in an Individual Panel (2010, neutral): “The effect of disabilities on long-run happiness is the focus of Wu (2001) and Oswald and Powdthavee (2008).”