Graham, Liam, 1968- and Oswald, Andrew J. (2006) Hedonic capital. Working Paper. Coventry: University of Warwick, Department of Economics. (Warwick economic research papers.

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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.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HN Social history and conditions. Social problems. Social reform
Divisions:	Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH):	Well-being, Quality of life, Happiness, Social adjustment, Welfare economics
Series Name:	Warwick economic research papers
Publisher:	University of Warwick, Department of Economics
Place of Publication:	Coventry
Date:	April 2006
Number:	No.745
Number of Pages:	36
Status:	Not Peer Reviewed
Access rights to Published version:	Open Access
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URI:	http://wrap.warwick.ac.uk/id/eprint/1450

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