Working Paper: NBER ID: w12062
Authors: Miles Kimball; Helen Levy; Fumio Ohtake; Yoshiro Tsutsui
Abstract: In August, September and October of 2005, the Monthly Surveys of Consumers fielded by the University of Michigan included questions about the happiness of a nationally representative sample of U.S. adults. The date of each interview is known. Looking at the data week by week, reported happiness dipped significantly in the first week of September, after the seriousness of the damage done by Katrina became clear. The impulse response of happiness is especially strong in the South Central region, closest to the devastation of Katrina. The dip in happiness lasted two or three weeks in the South Central region; in the rest of the country, reported happiness returned to normal after one or two weeks. In addition to the reaction to Katrina, happiness dipped significantly after the October 2005 earthquake in Pakistan. These results illustrate the potential of high-frequency happiness data to yield information about preferences over regional, national and international conditions by indicating the magnitude of the good or bad news conveyed by events.
Keywords: Happiness; Natural Disasters; Hurricane Katrina; Consumer Sentiment
JEL Codes: D6
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| happiness dip (E32) | psychological processing of bad news (G41) |
| happiness dip in South Central region (R11) | duration of happiness dip (C41) |
| happiness dip in rest of country (I31) | duration of happiness recovery (C41) |
| October 2005 earthquake in Pakistan (H84) | happiness dip (E32) |
| Hurricane Katrina (H84) | reported happiness (I31) |
| news about Hurricane Katrina's devastation (H84) | happiness dip (E32) |