Abstract
In developing countries, housing difficulties and environmental problems for poor peasants are prominent. In 2008, China began to explore pilot projects for the renovation of dilapidated houses in rural areas and has achieved remarkable results. This paper examines the impact of China's Renovation Program of Dilapidated Houses on the life satisfaction of poor peasant households. Using firsthand survey data of four poverty-stricken counties in Gansu Province and the Propensity Score Matching method, we find that the program significantly improves the poor peasant households' life satisfaction, with a greater impact on non-poverty-stricken villages and general-assurance households. In the mechanism analysis, we find that these positive treatment effects are mainly driven by the increases in wage income and operating income. In addition, we relax the assumption of parallelism and use the Generalized Ordered Logit model to further explore how this impact varies between groups. We show that people with a high level of life satisfaction are more significantly affected by the program. This study provides evidence that a sustainable living environment can improve the overall wellbeing of rural residents.