*Names in bold indicate Presenter
Preliminary results from pooled cross-sectional analysis suggest that blacks and Hispanics have worse health outcomes as unemployment rates increase; however, this effect diminishes when we include individual fixed effects. For example, in models without individual fixed effects, we find that a one percentage point increase in the unemployment rate results in a 0.7 percentage point increase in the likelihood a black respondent reports feeling depressed. However, in models with individual fixed effects this coefficient estimate falls to -0.002 and fails to achieve statistical significance. We find a similar pattern of results for Hispanic respondents and for several health outcomes. In contrast, we find no evidence that white or non-Hispanic respondents experience worse health as unemployment rates rise, either with or without individual fixed effects. This pattern of results is robust to excluding individuals who move across state lines between survey waves and to including several potentially endogenous controls.
The results of our analysis of heterogeneous health effects of unemployment have important policy implications. For example, evidence that certain groups are harmed by changing macroeconomic conditions more than others will help policymakers target interventions to the most vulnerable. Similarly, understanding the association between the state unemployment rate and the individual’s unobserved propensity for worse health may also inform policy responses to economic downturns.
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Davalos, Maria E. and Michael T. French. 2011. “This Recession is Wearing Me Out! Health Related Quality of Life and Economic Downturns.” The Journal of Mental Health Quality and Economics, 14(2): 61-72.
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