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Liquidity, Economic Activity, and Mortality

Author

Listed:
  • William N. Evans

    (University of Notre Dame)

  • Timothy J. Moore

    (University of Maryland)

Abstract

We document a within-month mortality cycle where deaths decline before the first day of the month and spike after the first. This cycle is present across a wide variety of causes and demographic groups. A similar cycle exists for a range of economic activities, suggesting the mortality cycle may be due to short-term variation in levels of economic activity. We provide evidence that the within-month activity cycle is generated by liquidity. Our results suggest a causal pathway whereby liquidity problems reduce activity, which in turn reduces mortality. These relationships may help explain the procyclical nature of mortality. © 2012 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • William N. Evans & Timothy J. Moore, 2012. "Liquidity, Economic Activity, and Mortality," The Review of Economics and Statistics, MIT Press, vol. 94(2), pages 400-418, May.
  • Handle: RePEc:tpr:restat:v:94:y:2012:i:2:p:400-418
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    Citations

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    Cited by:

    1. Jérôme Adda, 2016. "Economic Activity and the Spread of Viral Diseases: Evidence from High Frequency Data," The Quarterly Journal of Economics, Oxford University Press, vol. 131(2), pages 891-941.
    2. Andersson, Elvira & Lundborg, Petter & Vikström, Johan, 2015. "Income receipt and mortality — Evidence from Swedish public sector employees," Journal of Public Economics, Elsevier, vol. 131(C), pages 21-32.
    3. Zizza, Roberta & Adamopoulou, Effrosyni, 2017. "Regular versus lump-sum payments in union contracts and household consumption," Working Paper Series 2013, European Central Bank.
    4. Effrosyni Adamopoulou & Roberta Zizza, 2015. "Accessorizing. The effect of union contract renewals on consumption," Temi di discussione (Economic working papers) 1024, Bank of Italy, Economic Research and International Relations Area.
    5. Melinda Morrill & Sabrina Pabilonia, 2015. "What effects do macroeconomic conditions have on the time couples with children spend together?," Review of Economics of the Household, Springer, vol. 13(4), pages 791-814, December.
    6. Venke Furre Haaland & Kjetil Telle, 2013. "Pro-cyclical mortality. Evidence from Norway," Discussion Papers 766, Statistics Norway, Research Department.
    7. Dave, Dhaval M. & Kelly, Inas Rashad, 2012. "How does the business cycle affect eating habits?," Social Science & Medicine, Elsevier, vol. 74(2), pages 254-262.
    8. repec:eee:jbfina:v:85:y:2017:i:c:p:132-145 is not listed on IDEAS
    9. Melinda Sandler Morrill & Sabrina Wulff Pabilonia, 2012. "What Effects do Macroeconomic Conditions Have on Families' Time Together?," Working Papers 454, U.S. Bureau of Labor Statistics.
    10. McInerney, Melissa & Mellor, Jennifer M. & Nicholas, Lauren Hersch, 2013. "Recession depression: Mental health effects of the 2008 stock market crash," Journal of Health Economics, Elsevier, vol. 32(6), pages 1090-1104.
    11. Arna Vardardottir & Michaela Pagel, 2016. "The Liquid Hand-to-Mouth: Evidence from a Personal Finance Management Software," 2016 Meeting Papers 789, Society for Economic Dynamics.
    12. Inés Berniell, 2018. "Pay Cycles: Individual and Aggregate Effects of Paycheck Frequency," CEDLAS, Working Papers 0221, CEDLAS, Universidad Nacional de La Plata.
    13. Ruhm, Christopher J., 2015. "Recessions, healthy no more?," Journal of Health Economics, Elsevier, vol. 42(C), pages 17-28.
    14. Hitoshi Shigeoka, 2015. "School Entry Cutoff Date and the Timing of Births," NBER Working Papers 21402, National Bureau of Economic Research, Inc.
    15. Vikram Maheshri & Clifford Winston, 2016. "Did the Great Recession keep bad drivers off the road?," Journal of Risk and Uncertainty, Springer, vol. 52(3), pages 255-280, June.
    16. Can Cui, 2017. "Cash-on-hand and demand for credit," Empirical Economics, Springer, vol. 52(3), pages 1007-1039, May.
    17. Cuffe, Harold E. & Gibbs, Christopher G., 2017. "The effect of payday lending restrictions on liquor sales," Journal of Banking & Finance, Elsevier, vol. 85(C), pages 132-145.
    18. Restrepo, Brandon J. & Rieger, Matthias, 2016. "Trans fat and cardiovascular disease mortality: Evidence from bans in restaurants in New York," Journal of Health Economics, Elsevier, vol. 45(C), pages 176-196.

    More about this item

    Keywords

    mortality; liquidity constraints; income; consumption; life-cycle model; permanent-income hypothesis; tax rebates; pro-cyclical mortality;

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I10 - Health, Education, and Welfare - - Health - - - General
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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