Life Satisfaction in Russia: an Analysis for Urban and Rural Population

In recent years, one of the priorities of Russia's government is the spatial development of the country.  To develop a good policy, we need to understand how people value the place they live in and what factors they value in it. To study the factors that influence life satisfaction of people, a number of researchers note the importance of using new indicators, especially the indicators of individual well – being (for example, the subjective well-being of an individual-the level of life satisfaction).  In contrast to previous research on factors that affect life satisfaction, this paper will focus on the influence of the individual's place of residence on life satisfaction. In most previous studies, the authors use the place of residence as a controlling factor, so there are no attempts to explain the mechanisms by which an individual's place of residence affects the level of life satisfaction.  This work also plans to fill this gap. The purpose of this study was to evaluate the influence of place of residence on the level of life satisfaction of the Russian population and to identify factors that can explain this impact. Hypothesis of this research that life satisfaction is higher among people, other things being equal, who live in rural area compared to those who live in urban area. The result of the estimation model that was developed based on the theoretical part of the work on data from the longitudinal survey RLMS HSE (2012-2018) this hypothesis was confirmed and demonstrated the robustness of this results, regardless of model specifications and dependent variable for the female part of the Russian population. While for men, similar robustness of results was not found. Thus, it can be stated that women who live in Russia are more satisfied with their lives, other things being equal, if they live in rural areas. An additional task was to study the factors that influence the higher level of life satisfaction in rural areas. The hypothesis of a higher level of social capital in rural areas, which was tested using trust level data, was rejected.  This may indicate that despite the higher level of trust in rural areas, which was shown at the level of descriptive statistics, this characteristic is a "product" of other factors. At the same time, the hypothesis was confirmed that a higher level of housing characteristics (measured in the size of housing), as well as the fact of ownership of residential space, makes a significant contribution to the impact of the fact of living in rural areas. The contribution of housing characteristics to the difference in life satisfaction levels between rural and urban areas is estimated at 25%. Based on the analysis, recommendations were formulated in the field of spatial development.