Friday, November 19, 2010

Mortality consequences of receiving income

Given the falls in income that people in Ireland are experiencing & will continue to experience one might wonder is there upside? Well it turns out that the receipt of income can have a short run effect on mortality: increasing it, that is. So given that there is less of that around, maybe its not all bad news.

The short term mortality consequences of income receipt
William Evans Timothy Moore

Many studies find that households increase their consumption after the receipt of expected income payments, a result inconsistent with the life-cycle /permanent income hypothesis. Consumption can increase adverse health events, such as traffic accidents, heart attacks and strokes. In this paper, we examine the short-term mortality consequences of income receipt. We find that mortality increases following the arrival of monthly Social Security payments, regular wage payments for military personnel, the 2001 tax rebates, and Alaska Permanent Fund dividend payments. The increase in short-run mortality is large, potentially eliminating some of the protective benefits of additional income.

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