Happiness : What Can We Learn from Indonesian?

The economics of happiness is an interesting way to provide broader concept of wealth. It is able to provide insight on relative utility that is not only depending by income as mediated by individual choices or preferences within monetary budget constraint but also non monetary factors. Recent economic studies on happiness or subjective well being, most of them in developing countries, are able to give us some insight what makes individuals satisfied with their lives. Some of the studies in developed countries also found that within countries, higher level of income contribute on higher level of reported well being. Unfortunately, economic studies on happiness in developing countries, including Indonesia, are limited because of data limitation. Therefore, this paper analyzes the determinants of subjective well being in Indonesia assess whether there is positive association between individual wealth and happiness. Using Indonesia Family Life Survey Data Set, logistic regression analysis is used to identify the source of happiness from both economic and not economics variables