Entrepreneurship and mental well-being in China: the moderating roles of work autonomy and subjective socioeconomic status

The study addresses the high global burden of workplace mental disorders, with particular concern in emerging economies where regulation and occupational health services are weaker. Prior research on occupational health has largely focused on paid employees and on personal, occupational, and environmental factors. A growing organizational psychology stream suggests entrepreneurs often report higher work and life satisfaction despite stressors. However, most evidence comes from developed countries, leaving uncertainty about whether and how entrepreneurship influences mental well-being in emerging economies. Focusing on China—an economy with intensive entrepreneurial activity—the authors investigate whether entrepreneurship benefits mental well-being and through what mechanisms. Guided by self-determination theory (SDT), they hypothesize that entrepreneurship, as a volitional career choice, enhances psychological functioning at work (work autonomy) and in social status (subjective socioeconomic status, SSES), thereby improving mental well-being.

Existing literature documents a positive association between entrepreneurship and mental well-being, primarily in developed contexts, and emphasizes mediators related to personal psychological functioning, especially work autonomy. SDT posits that satisfaction of basic psychological needs (autonomy, competence, relatedness) is foundational to mental well-being. Entrepreneurs typically experience greater autonomy and meaningfulness at work than employees. Yet social psychological functioning—especially SES-related processes—has been underexplored. SES encompasses objective (OSES) and subjective (SSES) components; SSES arises from social comparison and is strongly linked to mental well-being across countries, including East Asia. Entrepreneurship is a pathway to wealth accumulation and upward mobility and confers managerial authority, potentially elevating SSES. In emerging economies with higher social fluidity and Confucian cultural emphasis on career success, SES-related mechanisms may be particularly salient. The study extends prior research by integrating both work-related (autonomy) and SES-related (SSES) psychological functioning as potential mediators.

Data: Seven waves of the China General Social Survey (CGSS: 2010, 2012, 2013, 2015, 2017, 2018, 2021). CGSS employs multistage PPS sampling across 28 provincial units (excluding Tibet, Qinghai, Ningxia), face-to-face interviews, >10,000 households per wave. Initial pooled sample: 85,091 individuals. Exclusions: age <18 or >60; not in labor market (unemployed, housewives, full-time students). Additional missing data exclusions: 1,277 (mental well-being items) and 3,634 (entrepreneurship/other variables). Multiple imputation used for remaining missingness. Final pooled cross-sectional dataset: N = 28,419 working adults. Measures: - Dependent variables (mental well-being): Positive mental well-being (PMW) measured by single-item life happiness (1 very unhappy to 5 very happy). Negative mental well-being (NMW) measured by single-item frequency of depression in past 4 weeks (1 never to 5 always); single-item measure validated in CGSS-based studies. - Independent variable (entrepreneurship): Coded from current work status. Responses "The boss" or "Working for yourself" defined as entrepreneurship (dummy =1); all others =0. - Mediators: Work autonomy measured by autonomy over how one works (1 never to 4 absolutely). Subjective SES (SSES) measured via 10-rung ladder items: current standing and expected standing in 10 years; constructed present SSES (SSESP), future SSES (SSESF), and a composite SSES via PCA (α=0.83). - Controls: Sociodemographics (gender, age, marital status), OSES (urban hukou, years of education, occupational status via ISEI, CPC membership, log annual income), health (self-rated physical health, exercise frequency), plus province and survey year fixed effects. Analytic strategy: - Main associations estimated via pooled OLS (POLS) with incremental controls. - Mediation tested using Baron & Kenny approach and KHB method to decompose direct/indirect effects and test significance. - Robustness: Two-stage instrumental variables (IV) using provincial Marketization Transition Index (MTI) as instrument for entrepreneurship; tests included Durbin–Wu–Hausman for endogeneity and first-stage strength (Wald F). Propensity score (PS) methods to address selection: matching (nearest neighbor, radius, kernel, local linear), inverse probability weighting (double-robust IPW), and PS as covariate; ATT estimated under common support.

- Entrepreneurs vs employees: POLS shows entrepreneurship positively associated with life happiness and negatively with depression. In fully controlled models, a 1 SD increase in entrepreneurship probability corresponded to a 0.029 SD increase in life happiness (p<0.01) and a negative coefficient for depression, indicating lower NMW. - Mediators: - Entrepreneurship strongly predicts work autonomy (β≈1.133, p<0.001) and SSES (β≈0.119, p<0.001), supporting H2a and H3a. - Both work autonomy and SSES associate with higher life happiness and lower depression (supporting H2b and H3b). - Mediation: Including work autonomy increased the magnitude/significance of entrepreneurship’s coefficient, providing no support for mediation via autonomy (H2c not supported). Including SSES reduced entrepreneurship’s coefficients and rendered them insignificant, indicating mediation via SSES (H3c supported). - KHB decomposition: Indirect effect via SSES on life happiness = 0.017 (p<0.001); via SSES on depression = 0.014 (p<0.001). Indirect effects via work autonomy not significant. SSES is the dominant mediator. - Robustness: - IV (MTI as instrument): Strong first stage (Wald F=409.98). Endogeneity rejected by DWH tests. 2SLS estimates: entrepreneurship → life happiness 0.329 (p<0.001); entrepreneurship → depression −0.796 (p<0.001), implying baseline models likely underestimated effects. - Propensity score methods (ATT): Happiness gains 0.029–0.043 across methods; depression reductions −0.034 to −0.043; large increases in work autonomy (≈1.124–1.159) and higher SSES (≈0.088–0.177). Findings support H1, H2a, H3a.

The findings support the SDT-based view that entrepreneurship, as a self-determined, volitional career choice, enhances psychological functioning and thereby improves mental well-being. In China, entrepreneurs report higher positive mental well-being and lower negative mental well-being than paid employees. Crucially, the pathway from entrepreneurship to mental well-being operates primarily through subjective socioeconomic status rather than work autonomy. This underscores the salience of SES-related psychological processes in an emerging economy with high social fluidity and cultural emphasis on career success. The study expands occupational health research beyond employee-focused stress models by emphasizing psychological functioning and extends entrepreneurship well-being research to an emerging economy context. Practically, supportive institutional environments may amplify entrepreneurs’ well-being benefits; individuals considering entrepreneurship should weigh risks against SES-related psychological gains highlighted by the results.

Using nationally representative CGSS data (2010–2021), the study shows that entrepreneurship in China is associated with higher positive and lower negative mental well-being compared to wage employment. Among the proposed mechanisms, subjective socioeconomic status mediates this relationship and is more influential than work autonomy. The work integrates personal (work autonomy) and social (SSES) psychological functioning within an SDT framework, contributes evidence from an emerging economy, and offers policy and individual career insights. Future research should test generalizability across other emerging economies, leverage longitudinal or quasi-experimental designs for stronger causal inference, and improve measurement of multi-dimensional mental well-being using domain-specific satisfaction and validated psychometric scales for negative outcomes.

- Generalizability: Findings are based on Chinese entrepreneurs; applicability to other emerging economies remains to be tested. - Causality and timing: Cross-sectional pooled design limits causal inference and temporal ordering between entrepreneurship and mental well-being; longitudinal or natural experiments are needed. - Measurement: Positive mental well-being assessed via global life happiness; negative via single-item depression. Future work should use multi-item psychometric scales and domain-specific well-being measures to capture multidimensionality.