Elsevier

Preventive Medicine

Volume 64, July 2014, Pages 54-62
Preventive Medicine

Assessing the short term health impact of the Great Recession in the European Union: A cross-country panel analysis

https://doi.org/10.1016/j.ypmed.2014.03.028Get rights and content

Highlights

  • First comprehensive assessment of the health effects of the Great Recession in EU

  • On average suicide rates have increased significantly as a result of the recession.

  • But all other cause-specific mortality rates have declined during the recession.

  • Higher social protection expenditures help countries smooth the health effect.

Abstract

Background

There are great concerns and some initial country-specific, descriptive evidence about potential adverse health consequences of the recent Great Recession.

Methods

Using data for 23 European Union countries we examine the short-term impact of macroeconomic decline during the Great Recession on a range of health and health behaviour indicators. We also examine whether the effect differed between countries according to the level of social protection provided.

Results

Overall, during the recent recession, an increase of one percentage point in the standardised unemployment rate has been associated with a statistically significant decrease in the following mortality rates: all-cause-mortality (3.4%), cardiovascular diseases (3.7%), cirrhosis- and chronic liver disease-related mortality (9.2%), motor vehicle accident-related mortality (11.5%), parasitic infection-related mortality (4.1%), but an increase in the suicide rate (34.1%). In general, the effects were more marked in countries with lower levels of social protection, compared to those with higher levels.

Conclusions

An increase in the unemployment rate during the Great Recession has had a beneficial health effect on average across EU countries, except for suicide mortality. Social protection expenditures appear to help countries “smooth” the health response to a recession, limiting health damage but also forgoing potential health gains that could otherwise result.

Introduction

Not surprisingly, the recent Great Recession has raised considerable concerns in the public health community about likely adverse health effects (WHO, 2009). Such fears were supported by, among others, a wealth of epidemiological and psychological evidence on the strong and positive associations – at the level of the individual – between lower income, unemployment and poor health (Catalano et al., 2011) and were expressed by other authors, too (Marmot and Bell, 2009).

With new data having become available in the meantime, a number of recent country-specific studies have examined – largely descriptively – what have been the early health effects of the recent global economic decline (also called the “Great Recession” — henceforth we are using ‘Great Recession’ and ‘global economic decline’ as synonyms), generally defined in the economic literature as starting in 2008 in Europe (Bentolila et al., 2010, Burda and Hunt, 2011). In particular, it has been suggested that suicide rates have increased significantly as a result of the sharp deterioration of economic conditions in the USA (Reeves et al., 2012), the UK (Barr et al., 2012), Italy and Greece (De Vogli et al., 2013). At the same time, some of these early descriptive analyses have been criticised as potentially misleading in that their results may have been driven by outliers and/or by the assumed linearity of the model employed to establish the empirical relationship (Fountoulakis et al., 2013). In order to overcome some of the limitations of the initial descriptive single-country studies, in this paper – using a panel covering 23 European countries for the period 2003–2010 – we examine in some more depth the impact of macroeconomic decline during the Great Recession on a larger set of health indicators.

This study builds on a fairly considerable existing literature on the relationship between economic fluctuations and health prior to the recent recession. The overall findings of this literature have been rather counter-intuitive ones: while recessions appear to be good for many health indicators (except for suicides), booms tend to entail mostly adverse health consequences (see for instance Catalano et al., 2011, Eyer, 1977b, Gerdtham and Ruhm, 2006, Ruhm, 2000 and Eyer, 1977a, and Bezruchka, 2009). The hypothetical mechanisms explaining these results that have been proposed but hardly rigorously tested in the literature (Catalano et al., 2011), can be summarised in four main pathways, following Ruhm (2000):

  • (1)

    With a decline in economic activity comes increased time for leisure activities which may include more physically active behaviours compared to what otherwise might predominantly be sedentary job-related activities; the increased leisure time may also be used to seek treatment that otherwise there might not be time for.

  • (2)

    During the economic downturn workers may benefit – as a result of reduced working hours – from lower stress levels.

  • (3)

    Work-related accidents are likely to decline during recessions, again as the result of lower workloads; other types of accidents, including motor vehicle traffic accidents, may decrease as well because of lower overall economic activity, affecting transport and potentially budget constraints, which in turn may reduce motorised transport as well as alcohol consumption.

  • (4)

    Economic recessions reduce the incentives for immigration, thereby potentially decreasing death rates in destination states through reduced crowding, because fewer immigrants might mean fewer imported diseases, or a lower risk of immigrants being unfamiliar with roads or the medical infrastructure. On the other hand, with migrants often being relatively young and hence likely healthy, lower immigration may induce a spurious negative correlation between economic conditions and mortality rates.

Bearing in mind the above suggested mechanisms, the approach we follow contributes to the recent literature on the health effects of the Great Recession in several ways: (1) We employ a log-linear model instead of a linear one, to obtain results more robust to outliers; (2) In contrast to the above-mentioned studies, we control for serial correlation of the mortality rates; (3) Our main results are based on data from 2003 onwards, pre-empting the influence of the 2001 crises — soon after 9/11. (4) We also explore whether – and if so, how – the health effects differ by countries' level of social protection.

Section snippets

The statistical model

In order to assess the relationship between macroeconomic fluctuation and health we follow the recent relevant economic and public health literature, using the unemployment rate as the main indicator for the macroeconomic fluctuation (see e.g. Tapia Granados, 2008) and as health indicator the overall mortality rate, selected cause-specific mortality rates, as well as health behaviour proxies.

To estimate the short-term effects of the Great Recession on health, we adopt in particular two

Results

Table 1 provides the effects associated with an increase of one percentage point in the standardised unemployment rate on all-cause mortality and on other seven health indicators. For each of these health indicators, the table contains the results of four slightly different approaches. For each of these samples, the first column presents the results without adjusting for auto-correlation, while the second shows the results with adjustment for auto-correlation. Overall, the results appear quite

Discussion

The overall objective of this study was to take a more comprehensive assessment of the impact of the recent macroeconomic fluctuations, using not only data from one country but from 23 EU countries, and applying more rigorous statistical methods. We confirm the finding from recent single country time series analyses that largely focused on suicide mortality (Barr et al., 2012, De Vogli et al., 2013, Reeves et al., 2012, Stuckler et al., 2011). At the same time we find that the overall health

Competing interests

The authors declare that there are no conflicts of interests.

Funding statement

The work was supported by the European Community's Seventh Framework Programme (FP7/2007-2013) under grant agreement no. 278173. Views expressed in the article do not necessarily reflect the official views of the European Union. The work of MS was also supported by the Centre for Diet and Activity Research (CEDAR), a UKCRC Public Health Research Centre of Excellence. Funding from the British Heart Foundation, Department of Health, Economic and Social Research Council, Medical Research Council,

Provenance and peer review

Not commissioned; externally peer reviewed.

Contributorship statement

MS had the idea of the study, supervised the analysis and contributed to the writing of the article. VT carried out the analysis and prepared a first draft of the article.

Acknowledgments

The corresponding author has the right to grant on behalf of all authors and does grant on behalf of all authors, an exclusive licence (or non exclusive for government employees) on a worldwide basis to the BMJ Publishing Group Ltd and its Licensees to permit this article (if accepted) to be published in JECH editions and any other BMJPGL products to exploit all subsidiary rights, as set out in our licence (http://group.bmj.com/products/journals/instructions-for-authors/licence-forms/).

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