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Loss of Life and Labour Productivity: The Canadian Opioid Crisis

Author

Listed:
  • Cheung, Alexander P.

    (University of Alberta, Department of Economics)

  • Marchand, Joseph

    (University of Alberta, Department of Economics)

  • Mark, Patricia

    (Nanaimo Regional General Hospital)

Abstract

The purpose of this study is to measure and quantify the losses in labour productivity due to the Canadian opioid crisis. Since 2016, over 15,393 Canadians have lost their lives due to opioid overdose. It is estimated that 10,775 of these overdose victims were employed in the 5 years prior to their death. This study applies public data to a human capital (HC) model to estimate the total lost productivity to the Canadian economy. The HC model mathematically projects forward the future economic output of an individual overdose victim given their occupation and age (at time of death) until retirement. The total estimated productivity loss is at least $5.71 billion dollars. Given this, the opioid crisis has affected a whole working cross-section of society causing irreversible damage to the Canadian economy in addition to an immeasurable human cost. A multidisciplinary review of the literature regarding opioid use disorder was also undertaken to enhance understanding into the nature of the Canadian opioid crisis in relation to premature deaths and the subsequent losses in labor productivity.

Suggested Citation

  • Cheung, Alexander P. & Marchand, Joseph & Mark, Patricia, 2020. "Loss of Life and Labour Productivity: The Canadian Opioid Crisis," Working Papers 2020-13, University of Alberta, Department of Economics.
  • Handle: RePEc:ris:albaec:2020_013
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    File URL: https://sites.ualberta.ca/~econwps/2020/wp2020-13.pdf
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    References listed on IDEAS

    as
    1. Antonis Targoutzidis, 2018. "Some adjustments to the human capital and the friction cost methods," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(9), pages 1225-1228, December.
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    More about this item

    Keywords

    opioid crisis; labour productivity; health economics;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • I10 - Health, Education, and Welfare - - Health - - - General
    • J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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