Happiness and Public Expenditure: Evidence from a panel analysis

The present study examines empirically the relationship between Happiness and public spending. We use a panel data from 2006 to 2015 for about 132 countries. We first estimated a Pooled, fixed effect and finally a GMM model to deal with the endogeneity problem. Our main findings suggest, first, that high levels of public expenditure are associated with greater Happiness around the world. Second, as expected, social support, Healthy life expectancy, Freedom to make life choices and confidence in national government contribute significantly to Happiness