Can Economic Policies Reduce Deaths of Despair?

39 Pages Posted: 30 Apr 2019

See all articles by William Dow

William Dow

University of California, Berkeley - School of Public Health

Anna Godøy

University of California, Berkeley - Institute for Research on Labor and Employment

Christopher Lowenstein

University of California, Berkeley

Michael Reich

University of California, Berkeley - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: April 2019

Abstract

Midlife mortality has risen steadily in the U.S. since the 1990s for non-Hispanic whites without a bachelor’s degree, and since 2013 for Hispanics and African-Americans who lack a bachelor’s degree. These increases largely reflect increased mortality from alcohol poisoning, drug overdose and suicide. We investigate whether these “deaths of despair” trends have been mitigated by two key policies aimed at raising incomes for low wage workers: the minimum wage and the earned income tax credit (EITC). To do so, we leverage state variation in policies over time to estimate difference-in-differences models of drug overdose deaths and suicides, using data on cause-specific mortality rates from 1999-2015. Our causal models find no significant effects of the minimum wage and EITC on drug-related mortality. However, higher minimum wages and EITCs significantly reduce non-drug suicides. A 10 percent increase in the minimum wage reduces non-drug suicides among adults with high school or less by 3.6 percent; a 10 percent increase in the EITC reduces suicides among this group by 5.5 percent. Our estimated models do not find significant effects for a college-educated placebo sample. Event-study models confirm parallel pre-trends, further supporting the validity of our causal research design. Our estimates suggest that increasing both the minimum wage and the EITC by 10 percent would likely prevent a combined total of around 1230 suicides each year.

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Suggested Citation

Dow, William and Godøy, Anna and Lowenstein, Christopher and Reich, Michael, Can Economic Policies Reduce Deaths of Despair? (April 2019). NBER Working Paper No. w25787. Available at SSRN: https://ssrn.com/abstract=3379466

William Dow (Contact Author)

University of California, Berkeley - School of Public Health ( email )

50 University Hall #7360
Berkeley, CA 94720-7360
United States

Anna Godøy

University of California, Berkeley - Institute for Research on Labor and Employment ( email )

2521 Channing Way #5555
Berkeley, CA 94720
United States

Christopher Lowenstein

University of California, Berkeley ( email )

310 Barrows Hall
Berkeley, CA 94720
United States

Michael Reich

University of California, Berkeley - Department of Economics ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States
510-643-7079 (Phone)
510-642-6432 (Fax)

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