Abstract
Subjective well-being measures are gaining recognition as important determinants of health outcomes. This paper examines whether life satisfaction matters for healthcare usage in the older population and, if so, what might help explain this relationship. To that end, we develop a mediation framework and test whether lifestyle choices and social capital are pathways through which life satisfaction at baseline influences subsequent healthcare usage. Using Heckman's approach to correct for sample selection bias, we find that those high in life satisfaction may need less outpatient care. We also show that this effect is explained by increased physical activity.
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