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Income shocks and mortality of low-wage workers: Evidence from wage allowances in Brazil

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  • Castro, Caio Pedro
  • Corbi, Raphael

Abstract

We examine the short-term impact of income shocks on mortality in Brazil using administrative data and the quasi-random timing of disbursements from a federal wage allowance program for low-income workers. Exploiting variation in payment timing by birth month and a sharp eligibility cutoff, we find that mortality increases by 9.5% during the week of payment, particularly for deaths related to economic activity such as cardiovascular conditions and external causes. Effects are strongest in areas with low financial development and poor healthcare access, suggesting that limited consumption smoothing and delayed medical care amplify mortality risks. Our findings highlight how institutional constraints in developing countries shape the health consequences of predictable income transfers, with implications for the design and timing of social protection programs.

Suggested Citation

  • Castro, Caio Pedro & Corbi, Raphael, 2026. "Income shocks and mortality of low-wage workers: Evidence from wage allowances in Brazil," Journal of Development Economics, Elsevier, vol. 179(C).
    • Handle: RePEc:eee:deveco:v:179:y:2026:i:c:s030438782500207x
    DOI: 10.1016/j.jdeveco.2025.103656
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    Keywords

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    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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