Health assessments correlate with health outcomes and subjective well-being. Immigrants offer an opportunity to study persistent social influences on health where the social conditions are not endogenous to individual outcomes. This approach provides a clear direction of causality from social conditions to health, and in a second stage to well-being. Natives and immigrants from across the world residing in 30 European countries are studied using survey data.
The paper applies within country analysis using both linear regressions and two stage least squares. Natives’ and immigrants’ individual characteristics have similar predictive power for health, except Muslim immigrants who experience a sizeable health penalty. Average health reports in the immigrant’s birth country have a significant association with the immigrant’s current health.
Almost a quarter of the birth country health variation is brought by the immigrants, while conditioning on socioeconomic characteristics. There is no evidence of the birth country predictive power declining neither as the immigrant spends more time in the residence country nor over the life course.
The second stage estimates indicate that a one standard deviation improvement in health predicts higher happiness by 1.72 point or 0.82 of a standard deviation, more than four times the happiness difference of changing employment status from unemployed to employed. Studying life satisfaction yields similar results. Health improvements predict substantial increases in individual happiness.