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The Influence of the Business Cycle on Mortality

Author

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  • Wolfgang H. Reichmuth
  • Samad Sarferaz

Abstract

We analyze the impact of short-run economic fluctuations on age-specific mortality using Bayesian time series econometrics and contribute to the debate on the procyclicality of mortality. For the first time, we examine the differing consequences of economic changes for all individual age classes. We employ a recently developed model to set up structural VARs of a latent mortality variable and of unemployment and GDP growth as main business cycle indicators. We find that young adults noticeably differ from the rest of the population. They exhibit increased mortality in a recession, whereas most of the other age classes between childhood and old age react with lower mortality to increased unemployment or decreased GDP growth. In order to avoid that opposed effects may cancel each other, our findings suggest to differentiate closely between particular age classes, especially in the age range of young adults. The results for the U.S. in the period 1956–2004 are confirmed by an international comparison with France and Japan. Long- term changes in the relationship between macroeconomic conditions and mortality are investigated with data since 1933.

Suggested Citation

  • Wolfgang H. Reichmuth & Samad Sarferaz, 2008. "The Influence of the Business Cycle on Mortality," SFB 649 Discussion Papers SFB649DP2008-059, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
    • Handle: RePEc:hum:wpaper:sfb649dp2008-059
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    File URL: http://sfb649.wiwi.hu-berlin.de/papers/pdf/SFB649DP2008-059.pdf
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    References listed on IDEAS

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Récession et justice sociale
      by Alexandre Delaigue in Econoclaste on 2008-11-13 23:36:16
    2. Recessions kill (some)
      by chris dillow in Stumbling and Mumbling on 2008-10-01 16:03:45

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    Cited by:

    1. Wu, Wen-Chieh & Cheng, Hui-Pei, 2010. "Symmetric mortality and asymmetric suicide cycles," Social Science & Medicine, Elsevier, vol. 70(12), pages 1974-1981, June.
    2. Katja Hanewald & Thomas Post & Helmut Gründl, 2011. "Stochastic Mortality, Macroeconomic Risks and Life Insurer Solvency," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 36(3), pages 458-475, July.
    3. Wolfgang Reichmuth & Samad Sarferaz, 2008. "Modeling and Forecasting Age-Specific Mortality: A Bayesian Approach," SFB 649 Discussion Papers SFB649DP2008-052a, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.

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    More about this item

    Keywords

    Age-specific Mortality; Business Cycle; Unemployment; Bayesian Econometrics; Health; Epidemiology;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • I10 - Health, Education, and Welfare - - Health - - - General
    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General

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