Analyzing Dependency of Subjective Well-being in Developing Countries to Macroeconomic Factors

Document Type : Research Paper


1 Director of Monetary and Banking Research Institute (MBRI

2 PhD Student in Economics, Tehran University


In macroeconomic studies, social welfare is assumed as a function of inflation and unemployment. Although the social welfare function which is dependent to unemployment and inflation variables has been used widely in macroeconomic theories, but this relation needs to be tested through empirical observations. This paper, using variables such as to economics of happiness area and subjective wellbeing data of 44 developing countries, shows the negative effect of unemployment and inflation rate on subjective well-being of these countries. Also it has been shown that 1 percent increase in total unemployment rate has more effect in decreasing welfare than a one percent inrceose in inflation rate.
JEL Classification:E24, E31, I38, J68, O11


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