Are healthier people happier? Evidence from Chile and Uruguay

Based on data from the Latinobarómetro, this study analyses data on happiness to establish the probability that an individual is happy. The focus is put on self-reported health status as a key aspect in increasing levels of happiness. The probability of being happy is econometrically estimated by probit models for each country. Results show that the main relationship is between happiness and health status. Whether this is a causal effect or only a correlation, is not clear. This issue is explored by using propensity score matching methods. These show that good health status increases the probability of being satisfied with life by between 13 and 17 percentage points. In line with the literature, we find that the relationship between age and happiness is U-shaped, with happiness at its lowest point at the age of 48.2.

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