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World Development Vol. 36, No. 11, pp. 2325–2340, 2008
Ó 2008 Elsevier Ltd. All rights reserved
0305-750X/$ - see front matter www.elsevier.com/locate/worlddev doi:10.1016/j.worlddev.2008.04.009

Life Satisfaction in Urban China: Components and Determinants
SIMON APPLETON and LINA SONG *
Nottingham University, Nottingham, United Kingdom
Summary. — Survey data from urban China in 2002 show levels of life satisfaction to have been low, but not exceptionally so, by international comparison. Many of the determinants of life satisfaction in urban China appear comparable to those for people in other countries. These include, inter alia, unemployment, income, marriage, sex, health, and age. Communist Party membership and political participation raised life satisfaction. People appeared fairly satisfied with economic growth and low inflation, and this contributed to their overall life satisfaction. There was dissatisfaction over pollution, but this—like job insecurity—does not appear to have impacted on life satisfaction.
Ó 2008 Elsevier Ltd. All rights reserved.
Key words — life satisfaction, happiness, economic growth, unemployment, China

1. INTRODUCTION
There is now a large literature on life satisfaction, although most studies have focussed on developed countries. One of the striking features of this literature is that economic growth in rich countries over the last 50 or so years, does not appear to have led to commensurate improvements in their happiness. Contemporary China is an interesting case to study life satisfaction, since it has experienced rapid and sustained economic growth for nearly three decades. Indeed, as the Chinese government has de facto abandoned much of the Marxist ideology that underpinned its rule, its authority has increasingly been seen to rest on its ability to continue to deliver economic growth. However, the international literature on life satisfaction cautions against simply assuming fast economic growth will led to a happy and content population. In this paper, we focus on urban China, using survey data on life satisfaction in 2002.
Although China’s rapid growth is a source of envy for much of the developing world, within the country there is concern over a variety of sources of discontent. While urban residents have shared in the country’s economic growth, they have also been subject to reforms that have impacted negatively on some. Mass retrenchment in state-owned enterprises has increased

unemployment. Much state- or work-unit provided welfare has been withdrawn—employees in the state sector feel insecure about their future in terms of pensions, medical insurance, and housing subsidies (Appleton, Knight, Song,
& Xia, 2004; Saunders & Shang, 2001). Income inequality rose sharply during the initial reform period (Knight & Song, 2003). Political reform has been slow in comparison to economic reform and there are concerns that this may lead to discontent. Shorn of its ideological roots, the Chinese Communist Party faces a challenge to its legitimacy, aggravated by frequent reports of corruption among its members.
In this context, the analysis of life satisfaction in contemporary urban China provides an interesting addition to the growing literature on happiness (Frey & Stutzer, 2002; Layard,
2005). The literature on life satisfaction in China is rather thin. Ji, Xu, and Rich (2002)
* The authors are grateful to the CCK Foundation for funding the project and the Ford Foundation for supporting the data collection. Bai Nansheng was a great help with the design of the project and the conduct of the pilot survey. Li Shi administered the data collection.
Helpful comments were provided by three anonymous referees. We are grateful to all of them. Final revision accepted: April 14, 2008.

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reported on data from Shanghai and Tianjin in
1993. This paper uses survey data purposively designed by the authors, administered by researchers at the Institute of Economics, Chinese…