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Are recessions good or bad for health? What might the mechanisms be?

Centre for Microsocial Change (MiSoC) Project-Linked Studentship

Supervisors:

Professor Paul Clarke, and Professor Michaela Benzeval, ISER, University of Essex

Project Description:

There is a significant debate about whether population health is pro-or counter-cyclical (Brenner, 1973; Ruhm, 2000; Economou et al, 2006; Gerdtham and Ruhm, 2006). Often employing aggregate time series data studies have shown that aggregate mortality levels increase in economic downturns (Brenner, 1973; Economou et al., 2006) and that mortality improves as the economy worsens (Ruhm, 2000; Gerdtham and Ruhm, 2006; Nuemayer, 2004). As techniques and data have improved, further research has begun to show that whether recession is good or bad for health, may well depend on the health condition considered, the ability to control for confounding variables or the type of welfare system under investigation. Using individual data, generally within country, studies have also begun to investigate the mechanisms that may link macroeconomic conditions to individual health. Health behaviours have been a primary focus since they are likely to be influenced by the change in income and time associated with unemployment. While theory suggests that unemployment may lead to people having time to take part in more experiences or prepare home cooked meals, evidence shows the opposite.

For example, Colman and Dave (2013) found physical activity decreased during a recession, mainly because those most affected were in manual jobs, so while leisure time activities may increase, this does not compensate for the loss of work-based activity. Dave and Kelly (2012) showed that in recessions people substitute healthy fruit and vegetables for high fat, calorific snacks. As well as the direct effect on those affected in the labour market, there may also be effects on their family, as within-household roles change (Colman and Dave, 2013) or in wider society, for example, as there is less traffic on the roads during rush hour. It is also important to consider the effect of recession on those who already have health problems. Evidence suggests that those with mental health problems are more likely to be adversely affected, both in terms of the labour market and their health during a recession (Evans-Lacko et al., 2013).

Against this background of contradictory findings, the aim of this PhD is to investigate the association between the business cycle, health behaviours and health using long term panel data from four different countries – USA (Panel Study of Income Dynamics), Australia (Household, Income and Labour Dynamics in Australia), Germany (German Socio-Economic Panel (SOEP)) and the UK (British Household Panel Survey/UKHLS). While the student will need to identify a specific focus based on a thorough review of the existing literature, the PhD will broadly investigate:

  • the association between employment change and health change at different stages of the economic cycle
  • the extent to which these associations are mediated by income change and health behaviours
  • whether these associations hold true for different health outcomes, different sub-population groups and in different countries.

The PhD will require complex statistical techniques, including fixed effect models and structural equation modelling. Depending on the availability of consistent data across studies for specific research questions, the comparative dimension may rely on qualitative comparisons or meta analyses.

This studentship will be based in the accredited University of Essex DTC pathway “Applied Economics and Data Analysis”. The studentship would be for three years, beginning in October 2017.

References:

M.H. Brenner (1973) Mental Illness and the Economy, Harvard University Press, Cambridge.
Colman, G., & Dave, D. (2013). Exercise, physical activity, and exertion over the business cycle. Social Science and Medicine, 93(0), 11-20. doi: http://dx.doi.org/10.1016/j.socscimed.2013.05.032
D. Dave, I.R. Kelly (2012) “How does the business cycle affect eating habits?” Social Science & Medicine, 74 (2), pp. 254–262
A. Economou, A. Nikolaou, I. Theodossiou (2008) “Are recessions harmful to health after all?: evidence from the European Union” Journal of Economic Studies, 35 (5) (2008), pp. 368–384.
Evans-Lacko S, Knapp M, McCrone P, Thornicroft G, Mojtabai R (2013) “The Mental Health Consequences of the Recession: Economic Hardship and Employment of People with Mental Health Problems in 27 European Countries”. PLoS ONE 8(7): e69792. doi:10.1371/journal.pone.0069792
Gerdtham, U.-G., & Ruhm, C. J. (2006). “Deaths rise in good economic times: Evidence from the OECD”. Economics & Human Biology, 4(3), 298-316. doi: http://dx.doi.org/10.1016/j.ehb.2006.04.001
Neumayer, E. (2004). “Recessions lower (some) mortality rates:: evidence from Germany”. Social Science and Medicine, 58(6), 1037-1047. doi: http://dx.doi.org/10.1016/S0277-9536(03)00276-4
C.J. Ruhm (2000) ‘Are recessions good for your health?’ Q. J. Econ., 115 (2) (2000), pp. 617–650.