Socioeconomic Status and Well-Being

This chapter focuses on the relationship between one’s socioeconomic status (SES), specifically income, and well-being and discusses key societal- and individual-level factors that have an impact on this relationship. The authors first provide definitions of well-being and then highlight the importance of considering which aspect of well-being is being measured and how the income-happiness relationship changes at different levels of income. They then continue with a more in-depth discussion on social comparisons and income inequality. The tendency to engage in social comparisons can be influenced by an individual’s attitude toward materialism and the values and level of income inequality in the society one resides in. The negative effects of income inequality may be aggravated in countries where there is an emphasis on consumerism and materialism for determining well-being. The influence of income equality is also mitigated by cultural ideologies (e.g., liberalism), generalized trust, and societal values (e.g., meritocracy and distributive justice beliefs). The chapter concludes with key policy implications (e.g., progressive taxation and income redistribution) and research directives.