The role of entrepreneurship in raising the level of relative income and subjective well-being of farmers in China

Entrepreneurship belongs to the category of initial distribution of income. The article raises questions whether entrepreneurship plays a positive role in the process of achieving the overall welfare of Chinese farmers, whether it contributes to increasing the level of their relative income and whether it can increase their subjective happiness. A theoretical hypothetical model “farmer entrepreneurship - relative income level - happiness” is constructed, and empirical analysis is carried out based on the data of the “Thousand Villages Survey” project, implemented by Shanghai University of Finance and Economics. First, we consider the impact of entrepreneurship on raising the level of relative income of Chinese farmers; then we analyze the impact of entrepreneurship on their sense of happiness. Finally, we use the mediator effect model to test the role of relative income level as a mediator in the process of influence of entrepreneurship on farmers’ sense of happiness. The study has found that across China entrepreneurship does indeed contribute to the increase in the level of farmers’ relative income, demonstrating the “enrichment effect”; it also contributes to the increase in their level of subjective sense of happiness, demonstrating the “happiness effect”; and the level of relative income plays a partial mediating role in this process. Thus, the sense of happiness of farmers engaged in entrepreneurship arises due to an increase in the level of their relative income and also due to the process of entrepreneurial activity itself. On this basis, it is recommended that state authorities and relevant structures actively promote the concept of “mass entrepreneurship and innovation” in rural areas, create a favorable environment for rural entrepreneurship, encourage farmers to become entrepreneurs, and promote the concept of “mass entrepreneurship and innovations” for rural entrepreneurship, encourage farmers to do business in order to increase their relative income and enhance their sense of happiness, thereby contributing to the overall financial and spiritual well-being of rural residents.