Income and Subjective Well-Being: The Importance of Index Choice for Sustainable Economic Development

The relationship between income and subjective well-being (SWB) has been widely studied. While previous research has shown that the correlation between income and SWB is not always strong, there is limited research examining how the choice of SWB index influences this relationship. Drawing on survey data collected from 32 countries between 2015 and 2017, this study explores how the income–SWB relationship varies across different SWB indices. The dataset encompasses both developed and developing nations. We analyzed six types of SWB indices documented in the literature—covering a broader range than is typically included—and conducted comparative analyses. To account for the possibility of a nonlinear relationship between income and these SWB measures, we used a semiparametric approach by applying generalized additive models. Our findings show that these six indices can be categorized into three groups: (1) mental health and affect balance, (2) subjective happiness and eudaimonia, and (3) life satisfaction and the Cantril Ladder. These results underscore the significant impact that the selected SWB index can have on the income–SWB relationship. While economic development is often assumed to enhance SWB, our analysis reveals that this relationship does not hold consistently across all SWB indicators. In particular, certain indicators show little or no improvement in well-being despite increasing income levels, suggesting the presence of excessive or inefficient consumption that fails to contribute to genuine human flourishing. These findings challenge the conventional growth-centric paradigm and call for a deeper societal and academic inquiry into what constitutes “true prosperity.” From a sustainability perspective, aligning economic progress with authentic improvements in well-being is essential. This requires not only more careful selection and interpretation of SWB metrics, but also a broader re-evaluation of consumption patterns and policy goals to ensure that future development contributes meaningfully to human and ecological well-being.