Papers that look interesting
By Arnold Kling
Glaeser and Sacerdote, suggesting that when rich people are around other rich people, they vote Democratic, but when they are around less-rich people, they vote Republican. Not having read the paper, I’m guessing on the basis of the abstract that rich people want to vote for Republicans for low taxes, and they are inclined to vote for Democrats on social issues; but people are somewhat chameleon-like on social issues, so the more social liberals you’re around, the more socially liberal you become.
Krueger and Schkade, testing 229 women on subjective well-being (“net affect”) two weeks apart, and finding a correlation of .64, with a correlation of life satisfaction of .59. They think this is OK. I’d say that most personal economic variables are more highly correlated at two weeks apart. I’d like to think that if you measured wealth at two-week intervals, the correlation would be something like .999.
In fact, I think it’s worth thinking about how the difference in relative measurement error affects studies of the relationship between wealth and life satisfaction. Because life satisfaction is measured on a finite scale, measurement errors and “true” life satisfaction are likely to be negatively correlated. (On a scale of 1 to 10, you truncate a measurement error that otherwise would cause you to measure somebody as 11.) This might be sufficient to explain the observation that life satisfaction shows diminishing returns with respect to wealth–it may be purely an artifact of these measurement biases.