Bismarck's Health Insurance and the Mortality Decline

72 Pages Posted: 11 Aug 2017

See all articles by Stefan Bauernschuster

Stefan Bauernschuster

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute; University of Passau - Business Administration and Economics; IZA Institute of Labor Economics

Anastasia Driva

Ludwig Maximilian University of Munich (LMU)

Erik Hornung

University of Cologne - Center for Macroeconomic Research (CMR); CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

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Date Written: August 2017

Abstract

We investigate the impact on mortality of the world's first compulsory health insurance, established by Otto von Bismarck, Chancellor of the German Empire, in 1884. Employing a multi-layered empirical setup, we draw on international comparisons and difference-in-differences strategies using Prussian administrative panel data to exploit differences in eligibility for insurance across occupations. All approaches yield a consistent pattern suggesting that Bismarck's Health Insurance generated a significant mortality reduction. The results are largely driven by a decline of deaths from infectious diseases. We present prima facie evidence that diffusion of new hygiene knowledge through physicians was an important channel.

Keywords: demographic transition, Health Insurance, Mortality, Prussian Economic History

JEL Classification: I13, I18, J11, N33

Suggested Citation

Bauernschuster, Stefan and Bauernschuster, Stefan and Driva, Anastasia and Hornung, Erik, Bismarck's Health Insurance and the Mortality Decline (August 2017). CEPR Discussion Paper No. DP12200, Available at SSRN: https://ssrn.com/abstract=3016787

Stefan Bauernschuster (Contact Author)

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 81679
Germany

University of Passau - Business Administration and Economics ( email )

University of Passau
Innstrasse 27
D-94030 Passau
Germany

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Anastasia Driva

Ludwig Maximilian University of Munich (LMU) ( email )

Geschwister-Scholl-Platz 1
Munich, DE Bavaria 80539
Germany

Erik Hornung

University of Cologne - Center for Macroeconomic Research (CMR) ( email )

Cologne
Germany

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Munich
Germany

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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