Mobility, uncertainty and subjective well-being in Hungary

In this paper subjective well-being measured by survey questions on life and material satisfaction is investigated. Our context is Hungary, between 2000 and 2002. We identify some basic variables that have important effect on how individuals perceive well-being in competitive pressure situation, namely, relative income mobility, subjective mobility, relative income position and subjective wealth position. We find that perception of changes in the relative income, wealth, and labour market positions, and the future prospects of these variables effect strongly on subjective well-being. Analysing the deviation between the objective and subjective trends of these variables and the reactions of households under these influences, we find that the objective trends of income and income mobility are very important with respect to satisfaction, but how people perceive their past relative income and income mobility, and their prospect of upward mobility in the future are what really determine satisfaction. The majority of respondents underestimate the real size of changes in their past financial positions, and the uncertainty of the competitive pressure situation is what really leads to this underestimation.