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Relative income and happiness in Asia: Evidence from nationwide surveys in China, Japan, and Korea

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  • Oshio, Takashi
  • 小塩, 隆士
  • Nozaki, Kayo
  • Kobayashi, Miki

Abstract

This study attempts to examine relative income effects on perceived happiness in three major Asian countries -- China, Japan, and Korea -- in comparison with the United Sates, on the basis of largely comparable nationwide surveys in these countries. Consistent with the results from previous studies in Western countries, comparisons with an individual's own income and average income of the reference group are significantly associated with the individual's perceived happiness in Asia. The associations between relative income and happiness are stronger for individual income than family income in China, while the opposite is true in Japan and Korea. Even after controlling for the subjective assessment of family income or personal class identification within the society as a whole, income comparisons within the reference group matter for assessing happiness, especially when using family income for comparisons. Moreover, relative deprivation within the reference group, which is measured by the Yitzhaki index, is negatively related to happiness, providing more evidence for the validity of the relative income hypothesis.

Suggested Citation

  • Oshio, Takashi & 小塩, 隆士 & Nozaki, Kayo & Kobayashi, Miki, 2010. "Relative income and happiness in Asia: Evidence from nationwide surveys in China, Japan, and Korea," PIE/CIS Discussion Paper 487, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hit:piecis:487
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    File URL: https://hermes-ir.lib.hit-u.ac.jp/hermes/ir/re/18693/pie_dp487.pdf
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    1. Ferrer-i-Carbonell, Ada, 2005. "Income and well-being: an empirical analysis of the comparison income effect," Journal of Public Economics, Elsevier, vol. 89(5-6), pages 997-1019, June.
    2. Adrian de la Garza & Atsushi Sannabe & Katsunori Yamada, 2008. "Job Satisfaction and Happiness: New Evidence from Japanese Union Workers," Discussion Papers in Economics and Business 08-10, Osaka University, Graduate School of Economics.
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    Cited by:

    1. Jianqiong Yuan & Jingjing Li & Jinyang Deng & Douglas Arbogast, 2021. "Past Experience and Willingness to Pay: A Comparative Examination of Destination Loyalty in Two National Parks, China," Sustainability, MDPI, vol. 13(16), pages 1-26, August.
    2. Hock-Eam Lim & Daigee Shaw & Pei-Shan Liao & Hongbo Duan, 2020. "The Effects of Income on Happiness in East and South Asia: Societal Values Matter?," Journal of Happiness Studies, Springer, vol. 21(2), pages 391-415, February.
    3. Lee, Won Fy, 2012. "The Effect of Relative Income in the Dynamics of Migration: Evidence from the VHLSS Panel Data," Master's Theses and Plan B Papers 142096, University of Minnesota, Department of Applied Economics.

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    Keywords

    Relative income; Relative deprivation; Asia;
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