Relative Income, Mental Accounting and the Life-Satisfaction of Older Adults: Do Retirees Differ from the Non-Retired

John Wiley and Sons Ltd.

We examine life‐satisfaction of older adults using a representative sample of Canadian individuals aged 45+. Our findings confirm a long line of employment relations research on the importance of ‘relational concerns’ in that: (i) income relative to the average for a given person's gender, age, region and marital status (relative income) matters more in improving life satisfaction as a whole than does absolute personal income; (ii) the relationship between relative income and happiness is much stronger for the non‐retired than retired persons, likely reflecting the importance of comparisons among peers at the workplace; and (3) absolute personal income does have a small positive relationship with life satisfaction but only for retirees and not for the non‐retired.


  • Morley Gunderson
  • Rafael Gomez
  • Umar Boodoo

Publication Type

Journal Name

Industrial Relations Journal.