Job Characteristics and Subjective Well-Being in Australia – A Capability Approach Perspective

Using the capability approach as conceptual framework, the present study examines empirically the effect of job characteristics on subjective well-being. First, I suggest a measurement model for four latent job characteristics, using a confirmatory factor analysis. Then, I examine the job characteristics' influence on life and job satisfaction, using Australian panel data. The results suggest that (i) the four latent job characteristics are valid constructs, (ii) favourable job characteristics increase life and job satisfaction significantly, (iii) job characteristics account for some of the unemployed's dissatisfaction, and (iv) controlling for unobserved heterogeneity is crucial in such exercises.