Government ideology and individual's psycological wellbeing

The determinants of psycological wellbeing and life satisfaction have been extensively studied in recent decades. However, the psychological effects of political events have barely been studied before despite being potentially large. In this paper we test the effects of government’s political orientation on individual’s psychological wellbeing. We use panel data on 19 European countries plus Israel from the Survey of Health, Aging and Retirement in Europe (SHARE) throughout a 13-year window (2nd to 7th wave) on people older than 50 years old. We merge these data with political data from ParlGov. We use a battery of indicators typically used in the psychological literature to measure wellbeing , such as such as life satisfaction, pessimism, irritability and depression and lack of enjoyment of life. Overall, we find a strong negative effect of ideological distance to the government on individual well-being. Such effect is larger when the subjects’ political beliefs are left-wing and the government leans to the right. The results are robust to the inclusion of individual level socio-economic variables, country level controls and fixed country year and individual effects.