The determinants of happiness: Evidence from a panel data approach

Abstract

This research aims to investigate the socioeconomic and health-related determinants of happiness across the countries from 2006 through 2017. We classify the countries based on the income levels, i.e., high-income countries (HICs), middle-income countries (MICs), and low-income countries (LICs). Based on the fixed-effect models, this study finds that income plays a significant role in influencing the level of happiness in all classification countries, which unable to confirm the Easterlin Paradox claim that more income does not bring better happiness. The unemployment is negative and statistically significant in HICs and MICs, but statistically insignificant positive in the LICs. Furthermore, this study also reveals that healthy life expectancy is significant only in the MICs and LICs. Finally, corruption perception is significantly negative correlated with happiness in the MICs. This study concludes that while it is vital to emphasize resorting to income-boosting economic policies, creating job opportunities and human relationships should not be sacrificed in order to improve the happiness level.