Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/216403 
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13091
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We estimate a model that allows for dynamic and interdependent responses of morbidity in different local areas to economic conditions at the local and national level, with statistical selection of optimal local area. We apply this approach to quarterly British data on chronic health conditions for those of working age over the period 2002-2016. We find strong and robust counter-cyclical relationships for overall chronic health, and for five broad types of health conditions. Chronic health conditions therefore increase in poor economic times. There is considerable spatial heterogeneity across local areas, with the counter-cyclical relationship being strongest in poorer local areas with more traditional industrial structures. We find that feedback effects are quantitatively important across local areas, and dynamic effects that differ by health condition. Consequently, the standard panel data model commonly used in the literature considerably under-estimates the extent of the countercyclical relationship in our context.
Subjects: 
macroeconomic conditions
health
morbidity
dynamics
heterogeneity
aggregation
JEL: 
J10
J21
C33
E32
Document Type: 
Working Paper

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