Objective Air Pollution and the Subjective Well-being of Chinese Residents

Abstract In this study, we constructed a new database to investigate the complex relationship between hazy weather, heightened air pollution concerns due to elevated PM 2.5 levels, and residents’ well-being in China. Our study concludes that the results of the baseline regression showing that PM2.5 significantly increases the well-being of the population is at odds with common sense, which is attributed to potential endogeneity issues, including reverse causation and omitted variables. For this purpose, first, we used the instrumental variables method to exclude the endogeneity problem and obtained a causal relation between objective air pollution and well-being, that is, objective air pollution significantly and negatively affects residents’ well-being. Second, we also considered the effect of individual differences and verified the mechanistic pathways by which objective air pollution affects well-being through residents’ subjective air pollution. Specifically, we found that in the air quality evaluation process, “pessimistic” residents have a lower level of well-being, and “optimistic” residents have a higher level of well-being. Finally, we verified that the level of household income can weaken the negative impact of objective air pollution on residents’ well-being and has a positive moderating effect. By integrating macro and micro-level data through innovative technology, our research provides policy recommendations for effective pollution management and improved overall well-being in China.