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Nexus of Economic Growth on Happiness and Inequality: Reexamine the Paradox | Asian Journal of Econo

Economic Growth is the essence of capitalism and it has the paradoxical relation on happiness and an inverse relationship with inequality. Capitalism is fueling the inequality in terms of access, opportunities, production, and distribution. The paper entitled “Nexus of Economic Growth on Happiness and Inequality” is reexamined the paradox which estimated the effect of economic growth and income on happiness and inequality by analyzing 1080 observations from 2008 to 2016 period covered 120 countries. The main explained variable of this paper is happiness and major interested explanatory variables are GDP per capita, GDP growth and inequality. The paper applied fixed and random effect and Linear Dynamic Panel Data (LDPD)/generalized method of moment estimation method as its estimation strategy. This paper investigated the positive association between GDP growth and income with happiness and found that the increase of economic growth and income lead to increase inequality which has a negative association with happiness.

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