Richer but Not Happier: Four Areas of Reforms in the Next Phase of Development in China

Abstract

Despite rapid economic growth, the proportion of people who report to be happy has declined and male adult mortality has increased in the past decade in China. This is a case of immiserizing growth—growth that comes with a lower level of welfare. We explore several potential causes of immiserizing growth: rising inequality, corruption, air pollution, and competitive pressure. Increasing marriage market competition due to a rise in the sex ratio imbalance seems to be a leading contributing factor. Facing intensive marriage market competition, parents with sons have to work harder and take more risks, which in turn diminishes happiness. The gain in utility as a result of additional income growth is not sufficient to offset the utility loss in the process of pursuing wealth