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The Long-Term Impact of the COVID-19 Unemployment Shock on Life Expectancy and Mortality Rates

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  • Bianchi, Francesco
  • Bianchi, Giada
  • Song, Dongo

Abstract

We adopt a time series approach to investigate the historical relation between unemployment, life expectancy, and mortality rates. We fit a Vector-autoregression (VAR) for the overall US population and for groups identified based on gender and race. We find that shocks to unemployment are followed by statistically significant increases in mortality rates and declines in life expectancy. We use our results to assess the long-run effects of the COVID-19 economic recession on mortality and life expectancy. We estimate the size of the COVID-19-related unemployment to be between 2 and 5 times larger than the typical unemployment shock, depending on race/gender, resulting in a 3.0% increase in mortality rate and a 0.5% drop in life expectancy over the next 15 years for the overall American population. We also predict that the shock will disproportionately affect African-Americans and women, over a short horizon, while white men might suffer large consequences over longer horizons. These figures translate in a staggering 0.89 million additional deaths over the next 15 years.

Suggested Citation

  • Bianchi, Francesco & Bianchi, Giada & Song, Dongo, 2020. "The Long-Term Impact of the COVID-19 Unemployment Shock on Life Expectancy and Mortality Rates," CEPR Discussion Papers 15605, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:15605
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    References listed on IDEAS

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    RePEc Biblio mentions

    As found on the RePEc Biblio, the curated bibliography for Economics:
    1. > Economics of Welfare > Health Economics > Economics of Pandemics > Specific pandemics > Covid-19 > Long-term consequences

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    Cited by:

    1. Víctor Giménez & Diego Prior & Claudio Thieme & Emili Tortosa-Ausina, 2021. "International comparisons of the COVID-19 pandemic management: What can be learned from activity analysis techniques?," Working Papers 2021/12, Economics Department, Universitat Jaume I, Castellón (Spain).
    2. Baira Faulks & Song Yinghua, 2021. "The COVID-19 Crisis: Implications for the Development and Growth of Agricultural Sector in EU countries and Russia," International Journal of Innovation and Economic Development, Inovatus Services Ltd., vol. 7(1), pages 37-46, April.
    3. Kai Fischer & J. James Reade & W. Benedikt Schmal, 2021. "The Long Shadow of an Infection: COVID-19 and Performance at Work," Economics Discussion Papers em-dp2021-17, Department of Economics, University of Reading.
    4. Bogliacino, Francesco & codagnone, cristiano & Folkvord, F. & Lupiáñez-Villanueva, Francisco, 2022. "The impact of labour market shocks on mental health: evidence from the COVID-19 first wave," SocArXiv wx9d4, Center for Open Science.
    5. Florin-Valeriu PANTELIMON & Bogdan-Stefan POSEDARU & Elena-Aura GRIGORESCU & Dimitrie-Daniel PLACINTA, 2021. "Labor Market Trends During The COVID-19 Pandemic," Informatica Economica, Academy of Economic Studies - Bucharest, Romania, vol. 25(2), pages 50-63.

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    More about this item

    Keywords

    COVID-19; Life Expectancy; Mortality; Unemployment rate;
    All these keywords.

    JEL classification:

    • 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
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts

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