Envy and Pride: How Economic Inequality Deepens Happiness Inequality in South Korea Woo Chang Kang * , JS Lee † , and BK Song ‡ Abstract This paper examines how economic inequality at the local level affects individual subjective well-being (SWB) through social comparison in Seoul, South Korea. We implement a multi- level analysis combining the asset inequality, calculated using the actual transaction prices of apartment, and the public opinion survey between 2008 and 2016. Our analysis shows that effect of inequality over SWB is conditional on individual income. In particular, upward comparison of the have-nots diminishes their SWB as neighborhood inequality increases, but downward comparison of the haves increases their SWB. This contrast suggests that, despite concerns about economic inequality and its negative consequences, the appeal for policy reform to reduce inequality may not be persuasive especially when it accompanies with increasing individual financial burden. * Assistant Professor, Korea University, woochang_kang@korea.ac.kr † Assistant Professor, Hongik University ‡ Assistant Professor, Hanyang University