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Disease and Development: The Effect of Life Expectancy on Economic Growth

  • Daron Acemoglu
  • Simon Johnson

We exploit the major international health improvements from the 1940s to estimate the effect of life expectancy on economic performance. We construct predicted mortality using preintervention mortality rates from various diseases and dates of global interventions. Predicted mortality has a large impact on changes in life expectancy starting in 1940 but no effect before 1940. Using predicted mortality as an instrument, we find that a 1 percent increase in life expectancy leads to a 1.7-2 percent increase in population. Life expectancy has a much smaller effect on total GDP, however. Consequently, there is no evidence that the large increase in life expectancy raised income per capita. (c) 2007 by The University of Chicago. All rights reserved.

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Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 115 (2007)
Issue (Month): 6 (December)
Pages: 925-985

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Handle: RePEc:ucp:jpolec:v:115:y:2007:i:6:p:925-985
Contact details of provider: Web page: http://www.journals.uchicago.edu/JPE/

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  1. Cutler, David & Lleras-Muney, Adriana & Deaton, Angus, 2006. "The Determinants of Mortality," Scholarly Articles 2640588, Harvard University Department of Economics.
  2. Schultz, T-P, 1996. "Wage and Labor Supply effects of Illness in Cote d'Ivoire and Ghana : Instrumental Variable Estimates for Days Disabled," Papers 757, Yale - Economic Growth Center.
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  6. Clive Bell & Shantayanan Devarajan & Hans Gersbach, 2003. "The long-run economic costs of AIDS : theory and an application to South Africa," Policy Research Working Paper Series 3152, The World Bank.
  7. Angus Deaton, 2004. "Health in an Age of Globalization," NBER Working Papers 10669, National Bureau of Economic Research, Inc.
  8. Thomas, D. & Strauss, J., 1997. "Health and Wages: Evidence on Men and Women in Urban Brazil," Papers 97-05, RAND - Reprint Series.
  9. Galor, Oded, 2004. "From Stagnation to Growth: Unified Growth Theory," CEPR Discussion Papers 4581, C.E.P.R. Discussion Papers.
  10. Sebnem Kalemli-Ozcan, 2012. "AIDS, “reversal” of the demographic transition and economic development: evidence from Africa," Journal of Population Economics, European Society for Population Economics, vol. 25(3), pages 871-897, July.
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  12. Lorentzen, Peter L. & McMillan, John & Wacziarg, Romain, 2005. "Death and Development," CEPR Discussion Papers 5246, C.E.P.R. Discussion Papers.
  13. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
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  19. repec:idb:brikps:42218 is not listed on IDEAS
  20. Sebnem Kalemli-Ozcan, 2002. "Does the Mortality Decline Promote Economic Growth?," Macroeconomics 0212008, EconWPA.
  21. repec:idb:idbbks:42218 is not listed on IDEAS
  22. Easterlin, Richard A., 1999. "How beneficent is the market? A look at the modern history of mortality," European Review of Economic History, Cambridge University Press, vol. 3(03), pages 257-294, December.
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