Consumption and happiness An analysis of the Netherlands

What types of consumption expenditure are most conductive to happiness? It is the question the study tends to explore. The analysis uses 2017 consumption data obtained from the Dutch Longitudinal Internet Studies for the Social Sciences (LISS) in which the dataset of consumption expenditure consists of five categories, which are transportation, food, housing, holiday and other expenditures. The results of our analysis contribute new insight on the research of happiness and consumption, at the same time provides evidence to suggest that happiness is affected not only by total expenditure but also by specific kinds of consumption expenditures. The results show that expenditure on holiday is positively associated with happiness, but that the expenditure on housing is negatively associated with happiness. Furthermore, the study finds that expenditures on transport and grocery do not influence happiness significantly. Additionally, individuals with financial stress or debts report to be less happy compared with those with no financial stress or little financial stress.