The Effects of the Opioid Crisis on Employment: Evidence from Labor Market Flows

74 Pages Posted: 18 Nov 2021 Last revised: 27 Jul 2022

See all articles by Anita Mukherjee

Anita Mukherjee

Wisconsin School of Business

Daniel W. Sacks

Indiana University - Kelley School of Business - Department of Business Economics & Public Policy

Hoyoung Yoo

University of Wisconsin-Madison

Date Written: July 27, 2022

Abstract

We show that the opioid crisis slows transitions to employment from unemployment and non-participation. We identify the effect of the opioid crisis from cross-state variation in triplicate prescribing regulations, which produced long-lasting reductions in opioid use by reducing the initial distribution of the blockbuster opioid OxyContin. Difference-in-differences estimates show that triplicate regulations induce unemployed and non-participating workers in triplicate states to return to employment about 10 percent faster than workers in non-triplicate states. These estimates imply a 1.1 percentage point higher level of employment in steady state.

Keywords: labor market flows; recession recovery; opioid regulation

JEL Classification: J21, E24, K32, E61, E71

Suggested Citation

Mukherjee, Anita and Sacks, Daniel W. and Yoo, Hoyoung, The Effects of the Opioid Crisis on Employment: Evidence from Labor Market Flows (July 27, 2022). Available at SSRN: https://ssrn.com/abstract=3964442 or http://dx.doi.org/10.2139/ssrn.3964442

Anita Mukherjee (Contact Author)

Wisconsin School of Business ( email )

975 University Avenue
Madison, WI 53706
United States

HOME PAGE: http://www.anitamukherjee.com

Daniel W. Sacks

Indiana University - Kelley School of Business - Department of Business Economics & Public Policy ( email )

Bloomington, IN 47405
United States

Hoyoung Yoo

University of Wisconsin-Madison ( email )

1180 Observatory Drive
Madison, WI 53706
United States

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