Long-run Effects of Lottery Wealth on Psychological Well-being

NBER Working Paper No. 24667

Issued in May 2018

NBER Program(s):Economics of Aging, Health Economics, Labor Studies, Public Economics



We surveyed a large sample of Swedish lottery players about their psychological well-being and analyzed the data following pre-registered procedures. Relative to matched controls, large-prize winners experience sustained increases in overall life satisfaction that persist for over a decade and show no evidence of dissipating with time. The estimated treatment effects on happiness and mental health are significantly smaller, suggesting that wealth has greater long-run effects on evaluative measures of well-being than on affective ones. Follow-up analyses of domain-specific aspects of life satisfaction clearly implicate financial life satisfaction as an important mediator for the long-run increase in overall life satisfaction.

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Document Object Identifier (DOI): 10.3386/w24667