The two major theories of QOL judgment - livability and comparison theories
- are tested. The first states that only absolute level of objective varia
bles will affect QOL, whereas the second states that only differences in ob
jective variables will. A 25-year, 8-nation database was developed that all
ows more powerful tests than previous research. Consistent with previous st
udies and with livability theory, absolute level of GDP/person had the larg
est effect on life-satisfaction. Contrary to previous research, a reliable
effect was also found for differences in GDP/person and the consumer price
index. The length of these effects is 9 or 10 quarters. That is, consumers
take into account changes as far back as 2 or 2 1/2 years, in addition to t
heir absolute level of GDP/person.