Happiness in life domains: Evidence from rural Bangladesh

Abstract

In this chapter, a two-layer approach is used to explain subjective well-being or happiness in rural Bangladesh. Overall happiness is estimated both as a function of happiness in different life domains and as a function of conventional explanatory variables such as education, income, and health. We also test the happiness-income relationship in different life domains. The results suggest that income explains a large part of the variation in overall happiness and that income is also closely related to various domain-specific happiness. The results have important implications, suggesting that income and happiness move hand in hand in developing countries like Bangladesh, and that to enhance happiness effectively in these societies, it is important to fill any gap in happiness in the economic domain by improving material well-being.