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Lecture 12

SOC SCI H1E Lecture Notes - Lecture 12: World Values Survey, Big Mac Index, Purchasing Power Parity

Social Science
Course Code
Cailin O'Connor

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Lecture 12
- The Data Revisited
- Does money predict more happiness, at a national level?
- Easterlin (1974) draws his data from a survey of 14 nations by Cantril (1965),
plus 9 more nations surveyed by Gallup
- His answer to the question is no
- Veenhoven (1991) uses the same data, but by presenting it differently, draws
different conclusion
- This data is both old (from 1960) and limited to 14 nations
- More recently a broader range of data has become available
- Since 1981, the World Values Survey has been conducted in six waves, having
surveyed 100 societes
- These surveys have resulted in over 1000 published papers
- The WVS studies a range of social, political, economic, and cultural factors, and
it tracks them over time – just as Easterlin (1995) argued was needed
-Schyns (1998) looked at the second wave of WVS data from 1990-1993
- 40 nations were studied, including “Taking all thing together” are they
very, pretty, etc. happy?
- In this survey about a question about life satisfaction is also asked – the
correlation between mean life satisfaction and mean happiness was .9,
which justifies using happiness as shorthand for both positive affect and
well being
- Schyns compared the mean happiness value with a quantity known as Purchasing
Power Parity (PPP)
- Schyns looks at this - also called “real GDP” - which looks at who at the
end of the day can acquire the goods and services that they need
-The Big Mac Index
is a measure of how much you can buy with
your money, but this is not what she uses
- Schyns found a strong correlation between happiness and PPP
- The correlation coefficient that measures the strength of the correlation
vary together – .64 with p<.001
- Is Wealth the Only Factor?
- Looking at data, one sees a clear upward trend: wealthier nations seem happier,
contrasting Easterlin
- There is no curvilinear relation, contrasting Veenhoven
- But there is a lot of variation
- Schyns hypothesizes that cultural factors account for at least some of the
remaining differences between happiness levels
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- To test this hypothesis, she develops three measures of “cultural” aspects of
society, all relative to freedom
- political rights and civil liberties, 1995 annual repott from
organization called “Freedom House.” Nations were rated on a scale of
- women and men equal opportunities; equal in
political, professional, and economic spheres. Range 0-1, based on UN
-Individualism / Collectivism
- individualism is supposed to be “freer” than
collectivism; how much society values individuals over the collective,
scale on 1-10
- Schyns found correlations between these cultural factors and happiness
- However, the cultural factors are also strongly correlated with wealth
- If you try to control for PPP, you find that the cultural factors are no
longer predictors of happiness
- BUT if you only look at wealthy nations, cultural factors did matter even
after controlling for wealth: Correlation = .43
- So Does Culture Matter?
- Schyns is looking at a very narrow measure of culture here - all connected to her
definition of “freedom”
-Ye et al. (2014) conducted a similar study
- They used a richer collection of 9 cultural measures, rated on a 7 point
scale, from the Global Leadership and Organizational Behavior
Effectiveness (GLOBE) surveys, which covered 62 nations
- GLOBE Cultural Measures
- In-Group collectivism - measures focus on small groups, like families and small
friend circles
- Southern Europe, maybe Italy or Spain
- Institutional Collectivism - measures focus on institutions providing social
- Northern Europe, social democracy, pay more in taxes into strong social
safety net
- Power Distance - extent to which power is shared in society
- Gender Egalitarianism - Measures the degree to with gender differences are
- Uncertainty avoidance - measure extent to which society seeks for orderliness in
- Assertiveness Orientation - measures how much individuals are encouraged to
be competitive
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