Subjective Well-Being in a Spatial Context

Recent progress in economics has moved subjective well-being towards the centre of the discourse on economic policy and academic research. Until recently, the spatial side of subjective well-being has remained under-exposed in the literature. This thesis aims to contribute to the literature on subjective well-being by placing a central focus on the spatial nature of these processes. We broadly contribute in three ways: first, we analyse which factors are associated with higher or lower subjective well-being within the region, using spatial data and spatial methods; second, we investigate how spatial differences in subjective well-being are associated with the residential location decision; finally, we investigate what the spatial extent is of these processes. We find that a person's social position within a neighbourhood is a key determinant of subjective well-being, while neither levels nor changes in accessibility of amenities correspond to an individual's subjective well-being. Local differences in quality of life can be used to explain both migration and property prices. For property prices, both individual differences in subjective well-being as well as happier neighbourhoods translate into higher property prices, reflecting a willingness to pay on a very local level for unobserved quality of the neighbourhood. In terms of migration, we show that the association between the quality of the residential environment and migration varies across space. The thesis highlights the importance of spatial and interpersonal heterogeneity in processes involving subjective well-being and emphasises the spatial nature of these processes.