As in other advanced countries, Korea has recently experienced high rate of suicide together with rapid economic growth. It is meaningful to empirically analyze the effect of residential environments as determinants of happiness because the ultimate g...
As in other advanced countries, Korea has recently experienced high rate of suicide together with rapid economic growth. It is meaningful to empirically analyze the effect of residential environments as determinants of happiness because the ultimate goal of policies is to enhance people"s happiness. This study empirically analyzes the effect of residential environments on happiness through two-step regression analysis on Chungnam Social Survey. In the first step we explain personal happiness as a function of the fixed effects of individual residence (i.e., Eup, Myun, and Dong) as well as personal characteristics, and in the second step average happiness of each residence captured in the first step where personal characteristics are controlled for is explained by residential environments of Eup, Myun, or Dong in question. This study finds that individual person"s happiness is affected mainly by the relationship with other family members, household income, employment status as well as the person"s own characteristics. Empirical results in the second step suggest that, rather than physical factors, social network (e.g., trust on neighbors) and environmental pollution are important, and these results imply that the effectiveness of current policies focusing on build-up of infrastructures could be restricted at least in terms of increasing people"s happiness.