A specially designed household survey for rural China is used to analyse the
determinants of aspirations for income, proxied by reported minimum income need, and
the determinants of subjective well-being, both satisfaction with life and satisfaction with
income. It is found that aspiration income is a positive function of actual income and
reference income, and that subjective well-being is raised by actual income but lowered
by aspiration income. These findings suggests the existence of a partial hedonic treadmill,
and can help to explain why subjective well-being in China appears not to have risen
despite rapid economic growth.