What are the Reasons for Differences in Job Satisfaction across Europe? Individual, Compositional, and Institutional Explanations

Abstract

This article looks at the determinants of job satisfaction in 27 European countries at both the individual and country level. Individual determinants include type of occupation, supervision responsibilities, working hours, and the assessment of various dimensions, such as intrinsic and extrinsic job characteristics. These factors already explain a large share of country-level variation which renders country differences in job satisfaction foremost the result of individual factors and the composition of the workforce. Notwithstanding this finding, some countries still have higher job satisfaction (country premium) whilst others have less job satisfaction (country penalty) once individual-level explanations are taken into account. To explain this, we considered the effects of country-level institutional factors, such as wage levels, extent of unionization, levels of unemployment and inequality, of which wage levels were the most important.