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RELATIONSHIP BETWEEN HOUSEHOLD INCOME AND SUBJECTIVE WELLBEING IN DENMARK AND LITHUANIA
Aiste Dirzyte, Simon Elsborg Nygaard, Ona Rakauskiene

ABSTRACT. Much of the debate over subjective wellbeing has focused on the role of income. There is a variety of models explaining relationship between income and wellbeing, but results sometimes are not complimentary, many authors indicate that additional research is needed. Therefore, we have chosen to examine the relationship between household income and subjective wellbeing in two countries, which differ in levels of happiness and income significantly. Various studies, including "World Value Survey", indicate Lithuania is among the countries demonstrating the lowest scores on happiness of population, while Denmark demonstrates the highest scores of happiness. Therefore, we aimed to evaluate the relationship between income and subjective wellbeing in Lithuania, and to compare it with the relationship between income and subjective wellbeing in Denmark. This paper presents some results of the survey which was conducted in 2014 in Lithuania (n=916) and Denmark (n=1282).The results demonstrated some positive correlations between income and subjective wellbeing factors in both samples, even though some significant differences were found. The analysis of Lithuanian data has demonstrated that the higher the net income is per month, the higher the subjective wellbeing is, overall satisfaction with life. Respondents in the higher net income groups reported stronger and more frequent positive emotional states and weaker / less recurrent negative or suicidal states, to compare with the lower net income groups. The results showed similar emotional wellbeing tendencies in the Danes' sample. However, the differences in life satisfaction on the whole between low and high household net income groups were not statistically significant in the Danish sample. This research contributes to the income - happiness relatedness model, and the results are in line with the findings that the relationship between income and wellbeing is more strong and significant in poorer groups or societies. However, the deeper analysis of related factors and comparison of the highest and lowest income groups in both samples could contribute to better understanding of the relationship between income and subjective wellbeing .

KEYWORDS: income, subjective wellbeing, happiness, Denmark, Lithuania.

JEL classification: M14, M19, P2.