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Prescription Opioids and Labor Market Pains: The Effect of Schedule II Opioids on Labor Force Participation and Unemployment

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  • Matthew C. Harris
  • Lawrence M. Kessler
  • Matthew N. Murray
  • Beth Glenn

Abstract

We examine the effect of prescription opioids on county labor market outcomes, using data from the Prescription Drug Monitoring Programs of ten U.S. states and labor data from the Bureau of Labor Statistics. We achieve causal identification by exploiting plausibly exogenous variation in the concentration of high-volume prescribers as instruments (using Medicare Part D prescriber data). We find strong adverse effects on labor force participation rates, employment-to-population ratios, and unemployment rates. Notably, a 10 percent increase in prescriptions causes a 0.53 percentage point reduction in labor force participation, similar to the drop attributed to the 1984 liberalization of Disability Insurance.

Suggested Citation

  • Matthew C. Harris & Lawrence M. Kessler & Matthew N. Murray & Beth Glenn, 2020. "Prescription Opioids and Labor Market Pains: The Effect of Schedule II Opioids on Labor Force Participation and Unemployment," Journal of Human Resources, University of Wisconsin Press, vol. 55(4), pages 1319-1364.
    • Handle: RePEc:uwp:jhriss:v:55:y:2020:i:4:p:1319-1364
    Note: DOI: 10.3368/jhr.55.4.1017-9093R2
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    Citations

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    Cited by:

    1. Cohle, Zachary & Ortega, Alberto, 2023. "The effect of the opioid crisis on patenting," Journal of Economic Behavior & Organization, Elsevier, vol. 214(C), pages 493-521.
    2. David Cho & Daniel I. García & Joshua Montes & Alison E. Weingarden, 2021. "Labor Market Effects of the Oxycodone-Heroin Epidemic," Finance and Economics Discussion Series 2021-025, Board of Governors of the Federal Reserve System (U.S.).
    3. Pinghui Wu, 2022. "Wage Inequality and the Rise in Labor Force Exit: The Case of US Prime-Age Men," Working Papers 22-16, Federal Reserve Bank of Boston.
    4. Chowdhury, Sulin, 2023. "Prescription Limiting Laws Effects on Opioid Misuse in the United States," 2023 Annual Meeting, July 23-25, Washington D.C. 335457, Agricultural and Applied Economics Association.
    5. Jeremy Greenwood & Nezih Guner & Karen A. Kopecky, 2022. "The Downward Spiral," NBER Working Papers 29764, National Bureau of Economic Research, Inc.
    6. Robert Bifulco & Iuliia Shybalkina, 2022. "Fiscal Impacts of the Opioid Crisis on State and Local Governments," The ANNALS of the American Academy of Political and Social Science, , vol. 703(1), pages 324-349, September.
    7. David Cho & Alvaro Mezza & Joshua Montes, 2022. "Choices and Implications when Measuring the Local Supply of Prescription Opioids," Finance and Economics Discussion Series 2022-078, Board of Governors of the Federal Reserve System (U.S.).
    8. Carolina Arteaga Cabrales & Victoria Barone, 2021. "The Opioid Epidemic: Causes and Consequences," Working Papers tecipa-698, University of Toronto, Department of Economics.
    9. Sim, Yongbo, 2023. "The effect of opioids on crime: Evidence from the introduction of OxyContin," International Review of Law and Economics, Elsevier, vol. 74(C).
    10. Alan Piper & David G. Blanchflower & Alex Bryson, 2021. "Does Pain Lead to Job Loss? A Panel Study for Germany," DoQSS Working Papers 21-19, Quantitative Social Science - UCL Social Research Institute, University College London.
    11. Buckles, Kasey & Evans, William N. & Lieber, Ethan M.J., 2023. "The drug crisis and the living arrangements of children," Journal of Health Economics, Elsevier, vol. 87(C).
    12. Jeremy Greenwood & Nezih Guner & Karen A. Kopecky, 2022. "Substance Abuse during the Pandemic: Implications for Labor-Force Participation," Economie d'Avant Garde Research Reports 35, Economie d'Avant Garde.
    13. Deiana Claudio & Giua Ludovica, 2021. "The Intended and Unintended Effects of Opioid Policies on Prescription Opioids and Crime," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 21(2), pages 751-792, April.
    14. Andrew Sullivan & Changwe Park, 2022. "Do Federal Grants for Medication-Assisted Opioid Treatment Reduce Homelessness?," The ANNALS of the American Academy of Political and Social Science, , vol. 703(1), pages 285-302, September.
    15. Colleen Heflin & Xiaohan Sun, 2022. "Food Insecurity and the Opioid Crisis," The ANNALS of the American Academy of Political and Social Science, , vol. 703(1), pages 262-284, September.
    16. Stith Sarah S., 2022. "Effects of work requirements for food assistance eligibility on disability claiming," IZA Journal of Labor Economics, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 11(1), pages 1-31, January.
    17. Rajeev Darolia & Colleen Heflin, 2022. "The Social and Community Consequences of the Opioid Epidemic," The ANNALS of the American Academy of Political and Social Science, , vol. 703(1), pages 7-14, September.
    18. Alan Piper & David G. Blanchflower & Alex Bryson, 2023. "Is pain associated with subsequent job loss? A panel study for Germany," Kyklos, Wiley Blackwell, vol. 76(1), pages 141-158, February.

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