Assessment of Resident Happiness under Uncertainty of Economic Policies: Empirical Evidences from China

Zhigang Ouyang, Fengyu Liu, Ge Zhai and Svitlana Bilan
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Zhigang Ouyang: School of Finance, Zhongnan University of Economics and Law, Wuhan 430073, China
Fengyu Liu: School of Finance, Zhongnan University of Economics and Law, Wuhan 430073, China
Ge Zhai: Bartlett School of Planning, University College London, London WC1H 0NN, UK
Svitlana Bilan: Faculty of Administration and Social Sciences, University of Economics and Innovation in Lublin, 20-209 Lublin, Poland

Sustainability, 2020, vol. 12, issue 18, 1-17

Abstract: The main aim of sustainable development is to increase the quality of life and resident happiness as the latter is one of the most important indicators for the assessment of quality of life. However, due to the uncertainty of economic policies, it will not only have a direct impact on resident well-being but may also indirectly affect resident well-being through specific channels. The economic policies are aimed at the achievement of sustainable development, therefore it is very important to investigate the influences of the uncertainty of economic policies on resident happiness. This allows to assess the sustainability of policies in terms of their inputs to the quality of life. The direct impact of economic policy uncertainty on resident well-being and the mediating effects of household asset allocation and the expectation on the above influencing relationship were analyzed based on the uncertainty index of China’s economic policies and households database of China Family Panel Studies (CFPS) during the period 2010–2018, so as to clarify the complete path of economic policy uncertainty affecting resident happiness. Results show that the uncertainty of economic policy significantly reduces resident happiness. In the context of the uncertainty of economic policies, families can relieve such negative impacts as an increasing proportion of financial assets in their total assets. However, decreases in asset shares for household consumer goods and future expectation obviously lower resident happiness. The research conclusions provide important input in research on the influences of the uncertainty of economic policy on the quality of life and offer new evidences for the development of “happiness economics”.

Keywords: uncertainty of economic policies; sustainability; quality of life; residents’ happiness; asset allocation; expectation (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
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