ABSTRACT
This chapter presents evidence on life satisfaction and happiness across Europe and its variation by age. The main finding, i.e. that there is a U-shaped relationship between age and subjective well-being, is already widely known among economists, although perhaps less so among followers of other disciplines. The chapter aims to explore the reasons of this pattern, and analyses the variation of preferences across the life cycle. Age-specific preferences were estimated with the use of the same explanatory variables as presented before and the introduction of an interaction term, interacting age and the specific variable of interest. The relationship between age and income seems to be rather homogenous. The only minor exception is among the youngest age group, many of whom are still participating in full-time education, family incomes and personal incomes may greatly differ, or aspirations may greatly diverge from achievements.
