THE RELATIONSHIP BETWEEN INTERNATIONAL TRADE AND THE WELLBEING OF A NATION: an empirical analysis.

International trade has been increasing in most countries due to ever increasing globalization. This paper evaluates the relationship between the increasing levels of international trade and the wellbeing of a nation. This relationship is analyzed in both a repeated cross sectional and time series setting. Exports are found to not have a positive relationship with happiness in both a repeated cross sectional and time series setting. Imports show the same result in a repeated cross sectional setting. However, import growth does show a positive relationship with happiness. Finally, this paper also looks into the effects of international trade on the wellbeing of different members of society. It is hypothesized that the the Chinese export boom, starting in the 90s, decreases the happiness of unskilled workers and increases the happiness of highly skilled workers. The analysis performed shows that this hypothesis only holds for the unskilled workers. Highly skilled workers are not significantly affected in terms of happiness by the Chinese export boom.