Being a Happy Farmer : Technology Adoption and Subjective Well-Being

This paper empirically investigates the impact of technology adoption on farmers’ subjective well-being, as measured by happiness and life satisfaction. The technology in focus is hired mechanization services in agricultural production. By fitting a nationally representative panel dataset – China Family Panel Studies – into an endogenous switching regression model that addresses potential selection bias, we find that the technology adoption leads to 6.1 percentage points increase in happiness and 2.4 percentage points increase in life satisfaction. Further analysis reveals that the effect is larger for farmers involved in off-farm employment and those operating relatively large farms. To underpin the causal effect, we test two plausible mechanisms, household income and time allocation, that are well documented in the literature to be positively correlated with happiness and life satisfaction. Our empirical analyses suggest that adopting hired mechanization services indeed increases the absolute income of farming households and allows farmers to allocate more time to leisure