Zhou Li, Shen Kunrong: Relative Poverty and Subjective Well-Being

Release time:2021-11-23Author: Zhou Li, Shen Kunrong

Abstract: Getting rid of relative poverty is not only the aspiration of the people, but also the point of governance. This paper conducts an empirical study based on CFPS data and found that when the per capita net income of a family weighted by equivalent family size is lower than 40% of the national (or urban-rural) median, the national subjective well-being decreases significantly. Using this standard to identify relative poverty has policy validity. Relative poverty is a subjective feeling, and its reference frame is generally the group of the same household registration. This kind of relative deprivation will have a negative impact on the people's life confidence and mental health. Relative deprivation comes from the lack of public goods and the experience of social injustice, and the efforts of relatively poor groups to integrate into society cannot improve their subjective well-being. To control relative poverty, it is not only necessary to emphasize the equalization of public services and the social security system at the supply level, but also to emphasize the equalization of availability and quality. To get rid of relative poverty, we should use the people's happiness line as the guide and the people's sense of gain as the judgment.