Abstract: With the rapid progress of society, the relationship between education and happiness has attracted the attention from many social researchers. At present, research on this topic can be summarized into two main analytic logics. One is the subjectivetosubjective logic, which claims that education can change one’s cognitive abilities, and in turn, he/she feels happy. The other is the objectivetosubjective logic, which insists that, through education, people obtain knowledge and skills with economic values that can be transformed into intangible capital for revenues. So, education’s impact on an individual’s subjective wellbeing is achieved by changing his or her objective living conditions. However, empirical investigation of the second analytic logic is very limited both at home and abroad, especially so in the relevant areas in China. Thereby, from the socioeconomic perspective in the happiness research, this study used income as an intervening variable and decomposed the effect of education on people’s happiness into direct effect and indirect effect (or the effect of education returns). Furthermore, it analyzed their impacts on Chinese urban residents’ happiness in different spaces and times. A positive correlation between education and urban residents’ happiness was observed. Individuals with high school or technical school diplomas and those with Bachelor’s degrees were the happiest. Regardless of the level of marketization in a region, education returns correlated positively with people’s happiness. Examined in different times, such positive correlation was significant prior to the recruitment expansion in higher education but disappeared after recruitment expansion in higher education was in practice. These results revealed an important problem: The increase in education returns didn’t necessarily improve the happiness felt by urban residents under certain conditions. To the author, the cause of this phenomenon might be in the changed structural characteristics that could have influenced education returns – a segmented labor market, an explanation different from that in the West.

Key words:  education, income, Chinese urban residents, happiness