The Consequences of Social Policy for Subjective Well-Being: A New Paradox?

By adopting approaches based on social expenditures and social rights data to measure the efficacy of social policy, significant advances have been made in international comparative research on social policy and subjective well-being (SWB). However, the question of whether the levels and distribution of welfare provisions play distinctive roles in SWB has remained largely unanswered. To address this issue, the present study adopts a third approach based on benefit recipiency data to clarify the more detailed effects of three dimensions of welfare transfers, namely, transfer share, low-income targeting, and universalism, on SWB and well-being inequality stemming from income. This analysis utilizes benefit recipiency data from the Luxembourg Income Study Database, pooled data from the World Values Survey from 1981 to 2022, and linear regression with country and time fixed effects and a country fixed-effects and slopes model. Through an international comparative analysis, this study reveals that (1) transfer share is positively associated with SWB and that (2) low-income targeting diminishes well-being inequality stemming from income at the cost of SWB among rich individuals. The results of this study indicate that the levels and distribution of welfare provisions play differing roles in SWB and that low-income targeting may have unintended consequences for SWB.