IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v77y2025ics154461232500337x.html
   My bibliography  Save this article

Impact of subjective wellbeing on investment behavior

Author

Listed:
  • Liu, Wei
  • Li, Wenbo
  • Chen, Yu

Abstract

Subjective wellbeing (SWB) affects individual behavior, including health, decision-making, and investment. Although corporate optimism links to better financial outcomes, the individual SWB–investment behavior remains unclear. This study finds that high SWB sustains risk tolerance, enhances autonomy and managerial skills, and boosts risk-oriented investments. Regression discontinuity analysis shows that SWB above the median drives venture capital behavior, while lower levels do not. These insights suggest strategies to leverage consumer wellbeing for investment, with big data and modeling enhancing the research's significance.

Suggested Citation

  • Liu, Wei & Li, Wenbo & Chen, Yu, 2025. "Impact of subjective wellbeing on investment behavior," Finance Research Letters, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:finlet:v:77:y:2025:i:c:s154461232500337x
    DOI: 10.1016/j.frl.2025.107073
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S154461232500337X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.107073?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Flèche, Sarah & Lekfuangfu, Warn N. & Clark, Andrew E., 2021. "The long-lasting effects of family and childhood on adult wellbeing: Evidence from British cohort data," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 290-311.
    2. John Ifcher & Homa Zarghamee, 2011. "Happiness and Time Preference: The Effect of Positive Affect in a Random-Assignment Experiment," American Economic Review, American Economic Association, vol. 101(7), pages 3109-3129, December.
    3. Jan-Emmanuel De Neve & George Ward & Femke De Keulenaer & Bert Van Landeghem & Georgios Kavetsos & Michael I. Norton, 2018. "The Asymmetric Experience of Positive and Negative Economic Growth: Global Evidence Using Subjective Well-Being Data," The Review of Economics and Statistics, MIT Press, vol. 100(2), pages 362-375, May.
    4. Kaplanski, Guy & Levy, Haim & Veld, Chris & Veld-Merkoulova, Yulia, 2015. "Do Happy People Make Optimistic Investors?," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 50(1-2), pages 145-168, April.
    5. Chuluun, Tuugi & Graham, Carol, 2016. "Local happiness and firm behavior: Do firms in happy places invest more?," Journal of Economic Behavior & Organization, Elsevier, vol. 125(C), pages 41-56.
    6. Graham, Carol & Nikolova, Milena, 2015. "Bentham or Aristotle in the Development Process? An Empirical Investigation of Capabilities and Subjective Well-Being," World Development, Elsevier, vol. 68(C), pages 163-179.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Yusiyu, 2019. "Regulation, protest, and spatial economics," Other publications TiSEM 809d31ac-b5a7-4e6c-b2eb-9, Tilburg University, School of Economics and Management.
    2. Carol Graham, 2005. "The Economics of Happiness," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 6(3), pages 41-55, July.
    3. Chuluun, Tuugi & Graham, Carol, 2016. "Local happiness and firm behavior: Do firms in happy places invest more?," Journal of Economic Behavior & Organization, Elsevier, vol. 125(C), pages 41-56.
    4. Wei Cui & Insook Cho, 2019. "Household’s Happiness and Financial Market Participation," Global Economic Review, Taylor & Francis Journals, vol. 48(4), pages 396-418, October.
    5. Clark, Andrew E. & Lee, Tom, 2021. "Early-life correlates of later-life well-being: Evidence from the Wisconsin Longitudinal Study," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 360-368.
    6. Krekel, Christian & MacKerron, George, 2023. "Back to Edgeworth? Estimating the Value of Time Using Hedonic Experiences," IZA Discussion Papers 16308, Institute of Labor Economics (IZA).
    7. Satya Paul, 2018. "Effects of Happiness on Income Generation and Inequality," Departmental Working Papers 2018-10, The Australian National University, Arndt-Corden Department of Economics.
    8. David Patiño & Francisco Gómez-García & Alejandro Marín-Serrano, 2022. "Subjective Well-Being and Aversion to Macroeconomic Losses: New Evidence," Journal of Happiness Studies, Springer, vol. 23(2), pages 359-375, February.
    9. Donato Pierno, 2024. "Does Life Satisfaction predict Economic Preferences? Evidence from cross-sectional data," Journal of Behavioral Economics for Policy, Society for the Advancement of Behavioral Economics (SABE), vol. 8(1), pages 39-46, December.
    10. Dukangqi Li & Weitao Shen, 2022. "Regional Happiness and Corporate Green Innovation: A Financing Constraints Perspective," Sustainability, MDPI, vol. 14(4), pages 1-25, February.
    11. Carol Graham & Julia Ruiz Pozuelo, 2017. "Happiness, stress, and age: how the U curve varies across people and places," Journal of Population Economics, Springer;European Society for Population Economics, vol. 30(1), pages 225-264, January.
    12. Burger,Martijn & Hendriks,Martijn & Ianchovichina,Elena, 2022. "Anatomy of Brazil’s Subjective Well-Being : A Tale of Growing Discontent and Polarization in the 2010s," Policy Research Working Paper Series 9924, The World Bank.
    13. Lee, Chien-Chiang & Wang, Chih-Wei & Lin, Weizheng & Chiu, Yi-Hsin, 2025. "The role of happiness in bank risk: An international cross-country analysis," Pacific-Basin Finance Journal, Elsevier, vol. 90(C).
    14. Anna Fabry & Goedele Broeck & Miet Maertens, 2022. "Gender Inequality and Job Satisfaction in Senegal: A Multiple Mediation Model," Journal of Happiness Studies, Springer, vol. 23(5), pages 2291-2311, June.
    15. Tasoff, Joshua & Letzler, Robert, 2014. "Everyone believes in redemption: Nudges and overoptimism in costly task completion," Journal of Economic Behavior & Organization, Elsevier, vol. 107(PA), pages 107-122.
    16. Lee, Boram & Rosenthal, Leonard & Veld, Chris & Veld-Merkoulova, Yulia, 2015. "Stock market expectations and risk aversion of individual investors," International Review of Financial Analysis, Elsevier, vol. 40(C), pages 122-131.
    17. Heinz Welsch, 2024. "Household Sector Carbon Pricing, Revenue Rebating, and Subjective Well-Being: A Dollar is not a Dollar," Working Papers V-444-24, University of Oldenburg, Department of Economics, revised Apr 2024.
    18. Drouvelis, Michalis & Powdthavee, Nattavudh, 2015. "Are happier people less judgmental of other people's selfish behaviors? Experimental survey evidence from trust and gift exchange games," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 58(C), pages 111-123.
    19. Christian Koch, 2024. "Is there a nexus between pro-social behavior and well-being? Correlational evidence," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 10(2), pages 279-293, December.
    20. Michiel Slag & Martijn J. Burger & Ruut Veenhoven, 2019. "Did the Easterlin Paradox apply in South Korea between 1980 and 2015? A case study," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 66(4), pages 325-351, December.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:77:y:2025:i:c:s154461232500337x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.