Determinants of Well-being for Developing and Developed Countries and their Role in Policy-making: A Panel Data Analysis

Jason Wei Jian Ng (), Santha Vaithilingam () and Jing Moon Chua ()
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Jason Wei Jian Ng: Department of Econometrics and Business Statistics, Global Asia in the 21st Century Research Platform, Monash University Malaysia
Santha Vaithilingam: Department of Econometrics and Business Statistics, Global Asia in the 21st Century Research Platform, Monash University Malaysia
Jing Moon Chua: Department of Econometrics and Business Statistics, Monash University Malaysia

Malaysian Journal of Economic Studies, 2019, vol. 56, issue 1, 85-105

Abstract: The gross domestic product has been the traditional indicator used to measure economic growth, with almost every country having national policies that are growth-centric in nature. Underlying this practice is the assumption that higher income levels precede higher levels of utility, or well-being. However, the Easterlin paradox discovered by Easterlin in the 1970s contradicts this economic assumption and has subsequently ignited interest in the study of subjective well-being and its determinants. Using the countries’ responses to the life satisfaction question in the World Values Survey as the measure of subjective well-being over a period of time, this study utilises panel data techniques to identify the key determinants of life satisfaction for developing and developed countries. The study also determines the relative importance of these key determinants for the two groups of countries. The findings of this study show that the determinants of life satisfaction differ across developed and developing countries, with religiosity being the only common determinant. The policy implications of these findings are discussed.

Keywords: GDP; panel data; subjective well-being; World Values Survey (search for similar items in EconPapers)
JEL-codes: I31 Z10 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:mjr:journl:v:56:y:2019:i:1:p:85-105

DOI: 10.22452/MJES.vol56no1.5

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