Social capital, income and subjective well-being: evidence in rural China

In a relational society like China, how does social capital (“relationship”) affect people's well-being? This article takes rural China as an example to explore the relationship between social capital, income and the level of well-being of Chinese farmers. After reviewing the definition and measurement of social capital and subjective well-being, this paper tests four hypotheses of social capital, income and subjective well-being. Using a 9200-observation sample from CHIPs 2002 and applying an ordered logistic regression model, this article provides evidence that the level of happiness among farmers is positively correlated with higher income, more active participation of social activities and reciprocal activities. That is, social capital is a strong predictor of happiness. Based on the findings, this article makes policy recommendations from three different aspects.