Cover: Life Satisfaction in China and Consumption and Income Inequalities

Life Satisfaction in China and Consumption and Income Inequalities

Published in: Review of Economics of the Household [Epub July 2017]. doi: 10.1007/s11150-017-9386-9

Posted on on December 19, 2017

by Xiaoyan Lei, Yan Shen, James P. Smith, Guangsu Zhou

This research uses nationally representative data to study how economic resources and inequalities are associated with life satisfaction of Chinese residents. We construct economic resource and inequality measures from expenditure rather than from income, after confirming that expenditure inequality is a better measure in the Chinese context. We find that economic inequalities in general are negatively associated with life satisfaction, and that this association is larger for inequalities in the lower half of the distribution than those in the upper half of the distribution. We further explore the mechanisms under which inequality can be associated with life satisfaction, and find that aspiration is potentially one important channel.

This report is part of the RAND Corporation External publication series. Many RAND studies are published in peer-reviewed scholarly journals, as chapters in commercial books, or as documents published by other organizations.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.