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Introduction: Social welfare is always one of the important topics in developed and developing countries, and they assume it as an effective factor to examine the performance of policymakers and economic planners, which can be influenced by many factors. One of the factors affecting conditions of people’s life is urbanization and migration from rural areas to cities.
Method: In this research, the non-linear effect of urbanization on the welfare of the people living in diverse provinces of Iran has been investigated in the period of 2011-2019. In addition to the urbanization, other variables, such as the average household income and the employment level of adults have also been studied.
Findings: The results of the research by using the dynamic panel data approach indicate that there is an inverted U relationship between urbanization and social welfare. In other words, with the increase of urbanization, the welfare level increases at first, but after reaching a maximum level, it declines Other variables were also used, such as average household income and adult employment level, and it was found that there was again a positive and direct relationship with social welfare, and increasing them resulted in growth of welfare too.
Discussion: It is clear living in cities will not necessarily increase the level of welfare; therefore, in order to prevent the migration of villagers to cities and the increase of marginalization and the overshadowing of the well-being of people living in cities, the level of health facilities, education, employment, and general well-being at the level of villages and non-urban areas should be improved.
 

Keywords: Dynamic panel data, Social Welfare, Urbanization.

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