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Happiness research is a comparably new field of economics. Until Richard Easterlin’s seminal contribution published in 1974, most economists believed there to be a clear and positive correlation between the material standard of living and subjective well-being (or happiness). Economic happiness research has found that, although income matters, inequality, other economic and non-economic factors also play an important role in subjective well-being. Although economic happiness research usually requires longitudinal data, there has so far been no cooperation with economic history. We argue that contact between these fields might be mutually beneficial to both sides. On the one hand, economic historians are experts on historical datasets and qualitative sources and can assist economists in their quest for information prior to the 1980s. On the other hand, the results of happiness research are valuable for analyzing problems in (economic) history for which traditional economic theory has proved to be insufficient.

In this paper we present new quantitative results on the linkages between absolute income levels, relative incomes, income inequality, and attitudes towards redistribution in a large sample of countries over the past 30 years. While we find that absolute income levels have a significant but very small effect on well-being, we find that relative incomes matter much more. In addition, we find that preferences for inequality are a significant driver of well-being. Lastly, we observe that overall inequality has an additional negative impact on well-being in a country in all three country-groupings. Taken together, this suggests that inequality has a rather strong negative impact on well-being. In fact, depending on the context, reducing inequality can do more to promote subjective well-being than increasing economic growth.

The paper addresses changes in income and wealth inequality in the first decades of modern economic growth. It relies on wealth data gained from probate inventories established in those provinces of the Habsburg Empire that eventually formed the Republic of Austria. These sources cover the whole population in the period between 1820 and 1913, including unpropertied persons. The analysis is based on a sample that consists of about 7,000 cases. The paper first examines wealth distribution on an aggregate level, using the Gini coefficient as a measure of inequality. It shows that the Austrian economy follows a Kuznets curve but that rise and decline are not particularly steep. These results are then compared with development within the regions, which yields quite different results for the regions involved. These results do not show the consistent picture of high inequality in more advanced regions and low inequality in backward regions that might be expected following the basic assumptions underlying the Kuznets curve. The explanation of the specific development within the different regions includes factors like class structure, family structure and patterns of inheritance, which explain why sectorial change, urbanization and other processes did not create a uniform pattern of wealth distribution in those provinces.

We examine the distribution of income across Swiss primary school teachers at the end of the 19th century. To assess income differences we use a detailed data set on the income of 14,000 Swiss primary school teachers in 1881 and 1894/95. In addition, we use annually aggregated test scores from pedagogical examinations at recruitment, to test for the impact of inequality on conscripts’ performance. Our results show that between-group inequality amounts to about 35 per cent of total income inequality, and that teachers’ income inequality does not play a role in explaining differences in the performance of conscripts in the pedagogical examinations.

The German population’s material standard of living during the ‘peace years’ of the Nazi regime (1933–38) is much debated. We use hitherto disregarded consumption data and the axiom of revealed preferences to test whether the material standard of living improved. We find that the food consumption bundle realized in 1935–36 must have been inferior to that of 1927–28, despite GDP per capita being much higher. Even in 1937–38 consumers were probably worse off compared to 1927–28. We conclude that increasing consumption constraints forced German consumers to diet and thus to a material standard of living that was much more frugal than national income figures suggest.

The aim of this paper is to provide an explanation for the remarkable difference in the contemporary Germans’ positive self-assessment of their living conditions and the development of the most important economic welfare indicators (like GDP or consumption per capita) during the Third Reich. To explain this discrepancy, findings from the new research field of happiness economics are applied to the peacetime Third Reich to analyze the development of the standard of living in this period. To start with, the development of the most important economic determinants of happiness during the 1930s is examined, based on current life satisfaction studies. In the second step, the theory of adaption and aspiration is used to explain the growing satisfaction of the Germans after the Great Depression.

This article presents a new estimate for the income of German university professors in the 20th century, using university archives as its main source. With these figures we reject the decline-perspective that has been predominant in the literature, influenced especially by Fritz K. Ringer’s book. We compare the professors’ salaries to those in leading occupations in private business, as well as state bureaucracy and find that relative income level developed in a similar fashion up to the 1970s. The 1970s were identified as a crucial turning point, as university professors started to fall behind their comparative social groups in alternative job markets. Making use of the literature on relative income, the article suggests the university professors changed their group of comparison in questions of remuneration during the course of the 20th century, so that the decreasing internal income-inequality affected their well-being more than the increasing gap to salaries outside universities.

The paper briefly describes the colorful career of the West German entrepreneur, Willy H. Schlieker and the rise to prominence of his one-man business conglomerate. It then goes on to discuss reasons and three hypotheses which purport to explain the company’s failure: entrepreneurial failure, a conspiracy among a number of his powerful creditors who were also competitors interested in eliminating an uncomfortable business rival; and the self-interested behavior of the court-appointed insolvence administrator. It concludes that the fate of Schlieker’s company was sealed by the way the administrator conducted bankruptcy procedures.

It is argued that from the early 19th century onwards Civil Servants received a remuneration that ensured a good standard of living and reflected social status. Yet, there are few empirical studies which test this hypothesis. This article attempts to bridge this gap by computing real living standards of district magistrates in Baden during the 19th century using a new consumption basket reflecting the material and social needs of members of the upper class. The empirical analysis shows that district magistrates had a high material living standard, as well as a high position within the income distribution. However, living standards were already high during the 18th century in both absolute and relative terms. Furthermore, absolute and relative living standards decreased from the mid-century onwards, negatively impacting district magistrates’ privileged position within society.

Why are some countries rich and others poor? The lecture explores the interplay of geography, globalization, technological change, economic policy, and institutions, to show how they have determined the wealth and poverty of nations around the world. Using historical examples to analyse the factors that have influenced growth, the lecture exposes what has caused the unequal world we live in today.