DOES AIR POLLUTION REDUCE SUBJECTIVE WELL-BEING? EVIDENCE FROM CHINA'S MICRO SURVEY DATA

Previous studies have not paid much attention to the heterogeneous effects of air pollution on subjective well-being. By matching the 2018 China Labor-Force Dynamics Survey data (CLDS2018) with urban air pollution data, we empirically examine the impact of air pollution on subjective well-being across pollution levels, income levels, gender, age, education as well as city size and region. Empirical analysis shows that an increase in air pollution has a negative and statistically significant impact on the well-being and the effect varies considerably across pollution levels, income levels, age, gender, education level, city size and region. Re-estimation using air pollution data released by the US embassy in China shows that the empirical results presented in this paper are robust. After accounting for potential endogeneity, PM2.5 continues to have a significant negative impact on the well-being of residents. Air pollution can affect an individual's mental health, social networks and economic status, which in turn affects their subjective well-being. Our analysis shows that air pollution is an important contributor to the Easterlin paradox, and (in the process of air pollution control) attention needs to be paid to both individual heterogeneity and urban differences. © 2023 World Scientific Publishing Company.