Social Sciences
4 years ago

Isolation near markets leads to lower subjective welfare assessments in South Asia.

Economic Development and Cultural Change
Isolation and Subjective Welfare: Evidence from South Asia
Marcel Fafchamps, Forhad Shilpi

Paper Summary

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The article explores how being far from markets and cities affects people's feelings about their income and consumption in Nepal. It found that living in isolated areas makes people feel like they have less money and resources, even if they actually don't. This effect is stronger for households that are already somewhat close to markets. This means that feeling isolated can make people think they are worse off financially than they really are.