DOES HIGHER INCOME AND HIGHER EDUCATIONAL LEVEL AFFECTED HAPINESS? WORLDWIDE EVIDENCE FROM QUANTILE REGRESSION

In order to sustain the current and future standard of living, maintaining long-term economic growth has been the ultimate goal of any nations. Many nations relentlessly pursue the path of economic growth to become developed and high income nations, but little do they realize that in their pursuit of material well-being, they seem to have completely missed the human emotions aspect. Recent literature on happiness has shown evidence that in several developed nations that have enjoyed rapid growth and accumulated high levels of material well-being, their citizens have not reported enjoying higher levels of happiness. Does higher income and education related to happiness? Previous studies have found mixed results. In this study we investigate the effects of income and educational attainment on the levels of happiness in a cross-section of 149 countries. Using OLS and quantile regression estimations, our results suggest that there is a nonlinear relation between income and the levels of happiness, in fact, exhibiting an inverted U-shaped Kuznets curve. On the other hand, primary education reduces the levels of happiness; while secondary and tertiary education increases the levels of happiness.