Determinants of Happiness in India: Ordered Probit Estimation of Life Satisfaction

Background: Maximising happiness of people is truly the proper measure of social and economic progress and the goal of any public policy. The socioeconomic and demographic factors that affect life satisfaction are so varied that many domains of life events influence happiness. Despite significant income growth and achievements in social indicators, India ranks poorly in the happiness rank. Such a disparity is attributed to the attitude of people towards positional and status concerns and the relative comparison of life evaluation. This paper attempts to identify the determinants of happiness and estimate their effect on life satisfaction among individuals in India. Specifically, this paper examines the relationship between income and life satisfaction in India in an attempt to understand whether money matters for happiness. Methodology: This study uses the sixth wave (2010-2014) of World Values Survey data across 12 Indian states. Since the response variable, life satisfaction or happiness, is measured in the WVS as an ordered category in the Likert scale, empirical estimation is based on the ordered probit method. The covariates considered as determinants of happiness in India are gender, social class, marital status, income, health status, employment status, education, number of children, age, and religion. Results: The estimated ordered probit results show that the probability of reporting happiness increases with education, health and social class whereas age, income, employment, children and gender have no statistical effect on happiness in India. Changes in the marginal effects are reported in the case of primary education, health, employment and middle social class. As income changes from high income to low income, people tend to become unhappier. Conclusion: Income, education, health and social status of people are positively associated with life satisfaction. Poor people and individuals in the middle social category are less happy.

Anomic Feelings and Happiness: Ordered logit estimation of the effects of freedom and control on subjective well-being

Background: Basic human concerns like money, income, health and family life do not satisfactorily explain fully the variations in subjective well-being. The long-run relationship between average income and subjective well-being is flat, despite the substantial rise in income and living standards. People value functional freedom and choice in social, political and institutional spheres of life than the concerns for money and economic well-being. This paper investigates whether anomic feelings like powerlessness, disillusion, dejection, subdued freedom and lack of trust and confidence could explain subjective well-being and the puzzling relationship between income and life satisfaction. Methodology: This study uses the sixth wave (2010-2014) World Values Survey data across 12 states. Anomic feelings are measured by the freedom of choice, control over own life and confidence in institutions. Since the subjective well-being indicators, life satisfaction and happiness are ordered categorical measures, the ordered logit regression method is used in the empirical estimation. Results: Anomic feelings of freedom of choice, control over own life and confidence in institutions influence life satisfaction significantly and positively. Conclusion: The attitude and confidence in institutions that govern freedom and choice and enable individuals to take own decision are important for a happy and satisfactory life in India.

Subjective Well-Being in India: Socioeconomic and Demographic Determinants and Differentials

Background: In the face of impressive performance in development indicators but poor ranking in the human development indicators, the subjective well-being in India has not been increasing commensurately with the rise in income. The lack of direct long-run relationship between income and happiness in India is a paradox that needs a deeper understanding of the influence of socioeconomic and demographic factors on subjective well-being over space and time. Methodology: The data from five waves of the World Values Survey of India for 24 years over the period 1990-2014 are used. The socioeconomic and demographic determinants of subjective well-being are analysed using chi-square test. The distribution of subjective well-being indicators - happiness, life satisfaction and financial satisfaction - at the group level are examined. Results: The average levels of life satisfaction and happiness have not increased commensurately with income and economic growth over time in India. The happiness level remains constant and life satisfaction and financial satisfaction declined with sharp variations across background characteristics of people and over space and time. Happiness distribution is left-skewed and life satisfaction is related, but not uniformly, with income. Significant differences in well-being exist with respect to education, income, social class, religion, age, marital status and health, but not much with employment and gender. Conclusion: The subjective well-being levels of people of India are influenced by their socioeconomic status with varying degree among different socioeconomic and demographic groups.