![]() (LEHD) data from the Census, which provide information on hires, separations,Įmployment, and thus turnover, also at the MSA level. ![]() In addition, we also use the Longitudinal Employer-Household Dynamics The data come from the Census' Business Dynamics Statistics (BDS) and are at (1996) and use their measure of job turnover, defined as the job creation To measureĬreative destruction we follow Davis et al. In the second part of the paper we test the predictions of the model usingĬross-sectional Metropolitan Statistical Area (MSA)-level US data. Prediction is that job creation increases future wellbeing more for more A third prediction is that job destruction has a less negativeĮffect on wellbeing, the more generous are unemployment benefits. A second prediction is that job creation increases and job destructionĭecreases wellbeing. Prediction of the model is that a higher turnover rate increases wellbeing more whenĬontrolling for aggregate unemployment than when not controlling for aggregate Value of future earnings: this enhances life satisfaction. Turnover implies a higher growth externality and therefore a higher net present The indirect effect is that a higher rate of Life satisfaction, and a higher probability for the unemployed to find a new job, The direct effects are that, everything else equal, more turnover translates intoīoth a higher probability of becoming unemployed for the employed, which reduces Higher rate of turnover has both direct and indirect effects on life satisfaction. Life satisfaction is captured by the expectedĭiscounted valuation of an individual's future earnings. Production in the sector resumes with the new technology only when the firm Worker currently employed in that sector loses her job and the firm posts a new Each time a new innovator enters a sector, the In this model, growth resultsįrom quality-improving innovations. Potential effects of turnover on life satisfaction. Of growth and unemployment to organize our thoughts and generate predictions on the Thus, in the first part of the paper we develop a simple Schumpeterian model Schumpeterian creative destruction with its resulting flow of entry and exit ofįirms and jobs, affects SWB differently for different types of individuals and in More specifically, we look at how an important engine of growth, namely In this paper, we provide a first attempt at filling this Subjective wellbeing (SWB) relate to income or income growth, but without looking inįurther detail at what drives the growth process and at how the determinants of ![]() Does higher (per capita) GDP or GDP growth increase happiness? The existingĮmpirical literature on happiness and income looks at how various measures of ![]()
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