Understanding the Easterlin Paradox in China: Investigating the Psychological Stress and its Relation to Nonincome Factors

Abstract

AbstractAlthough China’s economy and living conditions have improved significantly in the past few decades, previous studies have found that residents’ happiness has not kept pace with them accordingly. Such an Esterlin paradox may partly be due to the increase in psychological stress in the progress of China’s urbanization. To verify this point, we constructed an index of psychological stress (IPS) through daily internet search queries of four psychological stress-related keywords obtained from the Baidu Index from 2011 to 2021. The IPS for each province, municipality, and main city during 2018-2019 was also calculated. Meanwhile, the city level’s economic factors (GDP per capita, income of employees), living costs (housing prices, commuting time), and living environment quality (air quality, environmental noise) were employed to predict the IPS. The results showed that the IPS in China showed an upward trend from 2011 to 2021, and it was higher in the eastern coastal regions than in other regions. Housing prices and commuting time were the only significant predictors of IPS in the hierarchical regression. Our results suggested that the Easterlin paradox in China may be explained by the rising IPS linked with higher living expenses in the course of urbanization.