Bismarck's Health Insurance and the Mortality Decline

61 Pages Posted: 7 Sep 2017

See all articles by Stefan Bauernschuster

Stefan Bauernschuster

University of Passau - Business Administration and Economics; CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute; 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: June 2018

Abstract

We study the impact of social health insurance on mortality. Using the introduction of compulsory health insurance in the German Empire in 1884 as a natural experiment, we estimate flexible difference-in-differences models exploiting variation in eligibility for insurance across occupations. Our findings suggest that Bismarck’s health insurance generated a significant mortality reduction. Despite the absence of antibiotics and most vaccines, we find the results to be largely driven by a decline of deaths from infectious diseases. We present evidence suggesting that the decline is associated with access to health services but not sick pay. This finding may be explained by insurance fund physicians transmitting new knowledge on infectious disease prevention.

Keywords: Health Insurance, Mortality, Demographic Transition, Prussia

JEL Classification: I130, I180, N330, J110

Suggested Citation

Bauernschuster, Stefan and Driva, Anastasia and Hornung, Erik, Bismarck's Health Insurance and the Mortality Decline (June 2018). CESifo Working Paper Series No. 6601, Available at SSRN: https://ssrn.com/abstract=3032875

Stefan Bauernschuster (Contact Author)

University of Passau - Business Administration and Economics ( email )

University of Passau
Innstrasse 27
D-94030 Passau
Germany

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

Poschinger Str. 5
Munich, 81679
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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