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Is saying "from /by this reason" instead of "that's why" is considered idiomatic?

For example:

"People like to be happy; That's why they agree to pay for it."

Vs.

"People like to be happy; From / by this reason, they agree to pay for it."

N.b. I'd like to know other alternatives for "that's why".

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Neither "from this reason" nor "by this reason" are quite right. The preposition usually used with a reason is "for":

"People like to be happy; For this reason, they agree to pay for it."

That sentence is exactly equivalent to

"People like to be happy; That's why they agree to pay for it."

Both are idiomatic and sound fine.

Other expressions for "that's why" are "because of", "therefore", "consequently", even just plain "so", and many others as well.

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