Abstract

We establish a nexus between migration flows and self-assessed happiness by proposing an empirical model that brings together the determinants of happiness proposed by psychology and the typical gravity variables from the economic migration literature. Taking this estimation net of the usual gravity controls we propose an alternative happiness index that is consistent with the revealed preferences about happiness determinants in countries with different development levels and institutions. The revelation of preferences is indicated by the estimated coefficients for each of the determinants of happiness such that their weights in the proposed migration-based index directly result from observed data. Finally, we compare the country classification suggested by our proposed index and two existing indexes based on self-assessed happiness, and analyse the sources of existing mismatches, with policy implications.

Highlights

  • The happiness literature suggests that human beings set their preferences over a wide range of goods, social and moral values and institutions

  • We establish a nexus between migration flows and self-assessed happiness by proposing an empirical model that brings together the determinants of happiness proposed by psychology and the typical gravity variables from the economic migration literature

  • In this paper we propose a happiness index based on migration flows, where migration is taken as a mechanism for revealing preferences

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Summary

Introduction

The happiness literature suggests that human beings set their preferences over a wide range of goods, social and moral values and institutions. The fact that most of these indicators are based on answers to questionnaires subjects their results to at least two main concerns They can be affected by a number of potential errors that stem from language ambiguities, scale comparability and ambiguities related to the time period on which respondents based their answers (Bertrand and Mullainathan 2001). A second concern is that since country-level happiness indicators can be seen as the outcome results of economic and social policies and institutions, it is plausible to think that they are potentially subject to manipulation; see for example Frey (2011)

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