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Can Labor Market Policies Reduce Deaths of Despair?

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  • Dow, William H.
  • Godøy, Anna
  • Lowenstein, Christopher
  • Reich, Michael

Abstract

Do minimum wages and the earned income tax credit (EITC) mitigate rising “deaths of despair?” We leverage state variation in these policies over time to estimate event study and difference-in-differences models of deaths due to drug overdose, suicide, and alcohol-related causes. Our causal models find no significant effects on drug or alcohol-related mortality, but do find significant reductions in non-drug suicides. A 10 percent minimum wage increase reduces non-drug suicides among low-educated adults by 2.7 percent, and the comparable EITC figure is 3.0 percent. Placebo tests and event-study models support our causal research design. Increasing both policies by 10 percent would likely prevent a combined total of more than 700 suicides each year.

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  • Dow, William H. & Godøy, Anna & Lowenstein, Christopher & Reich, Michael, 2020. "Can Labor Market Policies Reduce Deaths of Despair?," Journal of Health Economics, Elsevier, vol. 74(C).
    • Handle: RePEc:eee:jhecon:v:74:y:2020:i:c:s0167629620301119
    DOI: 10.1016/j.jhealeco.2020.102372
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