Abstract
The purpose of this study is to explore the mediating effect of Free Choice on the relationship between financial-related variables, such as Financial Situation and Income, and subjective well-being constructs, namely Life Satisfaction and Happiness. Data from the 2019 World Values Survey were utilized. The study selected relevant questions related to the constructs being investigated: Income (Q288), Financial Situation (Q50), Free Choice (Q48), Life Satisfaction (Q49), and Happiness (Q46). Structural Equation Modeling was conducted to determine the indirect effects of Free Choice. The results revealed that across all social classes, Financial Situation predicts Life Satisfaction. Additionally, the Financial Situation also contributes to Happiness, except in the upper class. However, Free Choice mediates the relationship between Financial Situation and Life Satisfaction, but not Happiness, only among the middle class. These findings help to understand how financial situations affect subjective well-being (life satisfaction and happiness) differently across social classes, particularly clarifying the varying mediating role of Free Choice in this relationship. Private and public organizations can utilize this knowledge to develop policies related to financial security and well-being. It is recommended that the model investigated be validated using objective measures and multi-item measurements of constructs.
