Household’s Happiness and Financial Market Participation

Wei Cui, Insook Cho

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)


Using the 2014 China Family Panel Studies, this study examines the impact of household’s subjective well-being on financial decision. It investigates whether happiness affects household’s decision to participate in risky financial market. This study finds a non-linear relationship between happiness and the probability of financial market participation. The probability of risky financial market participation increases as self-reported happiness measure increases. However, the probability declines slightly at the highest level of self-reported happiness measure. In order to address a potential endogeneity problem, this study uses the Two Stage Least Squaredmodel with two sets of instrumental variables. These findings provide a strong support for the hypothesis that a person’s subjective well-being is one of the major determinants of household’s economic behaviours, and provide an important implication on household portfolio research.

Original languageEnglish
Pages (from-to)396-418
Number of pages23
JournalGlobal Economic Review
Issue number4
Publication statusPublished - 2019 Oct 2

Bibliographical note

Publisher Copyright:
© 2019, © 2019 Institute of East and West Studies, Yonsei University, Seoul.

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Economics, Econometrics and Finance(all)
  • Political Science and International Relations


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