Effect of productivity on happiness in Eastern African countries

Abstract

This study investigates the relationship between productivity and happiness in six Eastern African countries: Ethiopia, Kenya, Madagascar, Rwanda, Tanzania, and Uganda, from 2006 to 2022. Using panel data and a fixed-effects regression model, the analysis reveals a complex and context-specific interaction. Results indicate that productivity and life expectancy show a negative and statistically significant relationship with happiness. All other variables, including unemployment, social support, education index, and GNI per capita PPP, exhibit insignificant relationships with happiness. These findings reflect the unique socio-economic and cultural dynamics of Eastern Africa, where informal employment, subsistence activities, and systemic inequalities challenge traditional assumptions about well-being determinants. The study underscores the need for tailored policy interventions that balance productivity growth with investments in education, healthcare, and social safety nets, alongside efforts to enhance governance and reduce corruption. The research highlights the limitations of relying solely on productivity measures to improve happiness, advocating for a holistic approach to socio-economic development that considers regional specificities and cultural nuances.

Key Words: Happiness, productivity, well-being determinants, socio-economic dynamics, policy interventions