Determinants of Subjective Well-Being and Poverty in Rural Pakistan: A Micro-Level Study

Drawing on unique survey data for rural Pakistan, we investigate the impact of socio-demographic factors on happiness index with particular emphasis on subjective well-being measurement to evaluate poverty and its different components. The data elicits information on overall well-being in terms of household’s happiness with the current socio-economic status. We estimate a happiness model to explore to what extent a well-being perspective adds to our understanding of poverty. We find that the well-being approach closely depicts the idea of well-being poverty in terms of the level education, health and income which matter significantly. Moreover unlike developed nations where children have a negative impact on overall well-being, this study suggests a positive impact on well-being and poverty. As studies employing good data from developing countries are rare, this paper can potentially make a good contribution to the existing happiness literature, with special reference to Pakistan.