Happiness, Personal Income, and National Income: New Evidence from Taiwan

22 Pages Posted: 12 Dec 2016 Last revised: 21 Apr 2017

Zhen Cui

California State University, Los Angeles

Wen-Chieh Wu

National Chengchi University (NCCU)

Li-Hsueh Chen

California State University, Los Angeles - College of Business & Economics

Date Written: April 20, 7

Abstract

This study explores the relationship between income and happiness using data from Taiwan. It also proposes a two-stage estimation method for studying the macroeconomics of happiness. The study finds that while personal income has a strong positive effect on individual happiness, national income fails to have any significant effect in either the short run or the long run. This finding agrees with the Easterlin paradox, and suggests that good macroeconomic conditions do not notably improve happiness for an individual even in the short run.

Keywords: Happiness; Personal Income; National Income; Taiwan; Probit; Two-Stage Estimation

JEL Classification: I31; D63; C23

Suggested Citation

Cui, Zhen and Wu, Wen-Chieh and Chen, Li-Hsueh, Happiness, Personal Income, and National Income: New Evidence from Taiwan (April 20, 7). Available at SSRN: https://ssrn.com/abstract=2883618 or http://dx.doi.org/10.2139/ssrn.2883618

Zhen Cui (Contact Author)

California State University, Los Angeles ( email )

5151 State University Dr
Los Angeles, CA 90032
United States

Wen-Chieh Wu

National Chengchi University (NCCU) ( email )

No. 64, Chih-Nan Road
Section 2
Wenshan, Taipei, 11623
Taiwan

Li-Hsueh Chen

California State University, Los Angeles - College of Business & Economics ( email )

United States

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