matteo richiardi a b - cpo.it · ...and then the crisis hit (direct) health e ects economic trends...
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Child health effects of the economic crisis
Matteo Richiardi a b
a Institute for New Economic Thinking, Oxford Martin School, OxfordbNuffield College
Workshop“The nine months that change your life: birth cohort research in Italy”
Torino, 28 october 2014
Matteo Richiardi Health and the crisis 1
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
1 ...and then the crisis hit
2 (Direct) effects on health
3 Economic trends: inequality on the rise
4 The retrenchment of the welfare state
5 Necessity or choice?
6 Measuring economic insecurity
7 Modelling issues
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
...and then the crisis hitgross disposable real income and GDP, Euro area (17).
Source: Atkinson (2014, based on Eurostat data)
Matteo Richiardi Health and the crisis 3
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
...and then the crisis hit2000=100.
GDP GDP per head, 2005 US $ PPP
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
...and then the crisis hitunemployment rate, % of civilian labor force.
Source: Oecd.
Matteo Richiardi Health and the crisis 5
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Direct effects on childrentotal fertility rates
US (source: NHS) EU (source: Eurostat)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Pathways
There is a large body of work on recession and health, most of it in adults:there are both positive (i.e., road traffic accidents go down) and negativeeffects (i.e., suicides generally go up).
There are fewer data for children and youth.
Reduced opportunities for employment lower income and increases poverty,restrict food budget, decrease housing security/quality (e.g., via evictionsand moves) and harm parental mental health.
Increased food costs restrict food budgets for all.
Child labour may increase with attendant impacts on health and education.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on adult healthassociations of a 3%+ rise in unemployment with age-standardised mortality rates
Source: Suhrcke M, Stuckler D. (2012, Soc. Sci. Med.). Will the recession be bad for our health?It depends.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child health
Source: Rajmil et al. (2014, Int. J. Environ. Res. Public Health). Impact of the 2008 Economicand Financial Crisis on Child Health: A Systematic Review.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child healthfood and nutrition
Source: Rajmil et al. (2014).
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child healthhealth behaviors, non-accidental injuries, mental health and health-related quality of life
Source: Rajmil et al. (2014).
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child healthchronic conditions
Source: Rajmil et al. (2014).
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child healthinfant and child mortality
Source: Rajmil et al. (2014)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Impact on child healthRajmil et al. (2014)
Increased mortality in Greece (but using registered data in another study).
Increased nutritional risk of children of socially disadvantaged familiesworldwide.
Increase in non-accidental injuries and in social inequalities in perceivedhealth and health-related quality of life in some countries.
Increased risk of child maltreatment in the US.
Most of the studies reviewed were not specifically designed to analyse theimpact of economic crisis on child health, and are not sufficiently robust toestablish a causal relationship.
Overall quality of the studies reviewed is mixed.
As a result, the level of evidence is weak to establish clearrecommendations.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Top 1% income shareUS
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Top 1% income shareanglosaxon countries
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Top 1% income sharecontinental Europe and Japan
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Wage shares
Source: Wikimedia commons, based on AMECO data base from European Commission staff offices
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Wealth
Source: Piketty and Zucman (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
InheritanceFrance
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Top marginal tax ratesUS
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Taxes and the richesChange in top income shares and top marginal income tax rates
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
Theres been class warfare going on for the last 20 years...
...and my class has won.
Warren Buffet interviewed on CNBC, 30/9/2011
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Taxes and the richesChange in top income shares and top marginal income tax rates
Source: Alvaredo, Atkinson, Piketty, Saez (2013)
Theres been class warfare going on for the last 20 years... ...and my class has won.
Warren Buffet interviewed on CNBC, 30/9/2011
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
The retrenchment of the welfare state
Matteo Richiardi Health and the crisis 23
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
The retrenchment of the welfare state
Matteo Richiardi Health and the crisis 23
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Family benefitsper capita (e)
Source: Eurostat.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Family benefitsratio 2012/2009
Source: Eurostat.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Health expenditureper capita (e)
Source: Eurostat.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Health expenditureratio 2012/2009
Source: Eurostat.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Number of GPsPiedmont
Source: Piemonteincifre.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
The retrenchment of the state?
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
ConsequencesLife expectancy at birth, females.
Source: Oecd.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
A primer on the Great Recession1. The boom
The Great Leveraging: Huge financialization of advanced economies
Source: Taylor (2012)
In the US: credit financed to a large extent private consumption andhousing (mortgages).In Europe: credit (from the core) financed to a large extent privateconsumption in the periphery, as a couterbalance of increasing externalimbalances due to the currency union.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Interlude: Europe dividedinflation (CPI)
Source: Oecd
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Interlude: Europe dividedcurrent account surplus/deficit (net external position) (million e)
Source: Oecd
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Interlude: Europe, finally united?
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
A primer on the Great Recession2. The bust
Credit freezes.
The economy dips into recession.
Gov’t budget deteriorates (lower tax revenues, higher expenditures, bankbailouts (“too big to fail”)).
Gov’t debt further increases.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
A primer on the Great Recession3. Austerity
In the US: Austerity is a choice
“Holy war” against the state, fought by an alliance between big businessand the ideological right.
In Europe: Austerity is a necessity (thanks to the Euro)
Capital from the core is recalled to the core.
Interest rates (the “spread”) in the periphery increase.
Without the ability to use the printing press, gov’ts in the periphery haveto reduce public spending.
Without exchange rate adjustments, income in the periphery has todecrease to reduce external imbalances.
Matteo Richiardi Health and the crisis 36
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
A primer on the Great Recession3. Austerity
In the US: Austerity is a choice
“Holy war” against the state, fought by an alliance between big businessand the ideological right.
In Europe: Austerity is a necessity (thanks to the Euro)
Capital from the core is recalled to the core.
Interest rates (the “spread”) in the periphery increase.
Without the ability to use the printing press, gov’ts in the periphery haveto reduce public spending.
Without exchange rate adjustments, income in the periphery has todecrease to reduce external imbalances.
Matteo Richiardi Health and the crisis 36
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Selected readings
De Grauwe P (2013). Design Failures in the Eurozone: Can they be fixed? LEQS Paper No.57/2013.e
Fernandez-Villaverde J, Garicano L and Santos T et al. (2013). Political Credit Cycles: TheCase of the Eurozone. Journal of Economic Perspectives 27(3): 145-66.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Security vs. precariousness
What matters for well being (including adult and child development andhealth) is security.
Work security (or lack thereof, precariousness) does not depend solely onholding an open-ended job; instead, it emerges as the outcome of theinteraction between labor market dynamics and the social protectionsystem, with the latter that may compensate for failures of the labormarket and the other way around.
The relationship between the main strategy of labor flexibility adopted inmany advanced countries in the past 20 years –reducing regulatoryconstraints to the use of non standard, mainly fixed-term work– andworker security cannot be solved at the analytical level: empirical researchon the consequences of flexibility in terms of work careers, wages andsocial protection must be carried out.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Work security
Worker security: capability of an activeindividual to maintain an adequate livingstandard through labor marketparticipation and/or (public or mandatoryprivate) social protection when not inwork.
Worker security is given by a combinationof employment security, wage security andsocial security.
Berton, Richiardi, Sacchi (2012). The political economy of work security and flexibility. PolicyPress.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Employment security
Employment security: reasonable expectation of having secure andcontinuous employment careers, which may entail changing employers andjobs.
Employment continuity is a matter of:? duration of the contracts;? frequency of job-to-job transitions;? duration of non-employment;? characteristics of the new job after non-employment (frequency of
transitions towards contracts with longer duration).
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Employment security
W.r.t. open-ended contracts, fixed-term contracts entail negative effectson employment continuity in all four countries, but in different degrees.
Italy and Spain are similar: relative entrapment (TAW at the beginning ofone’s career not so bad in Italy).
In Germany fixed-term employment not too detrimental for career;exception: TAW.
Strong segmentation in Japan.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Wages security
Nowhere do non-standard workers enjoy higher wages: compensationhypothesis strongly rejected.
At best, comparable wages after controlling for individual and firmcharacteristics.
Some country-specific categories are worse off, even after controlling forindividual and firm characteristics:
? Independent contractors in Italy;? TAWs in Germany;? (Full-time) part-timers in Japan.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Social securityEntitlement, eligibility, coverage
Entitlement denotes formal availability of an actionable right to benefitprovision for a given category of workers, that may then be conditional tofurther specific requirements. Its extension comprises those who –inprinciple– have the formal opportunity to receive a benefit.
Eligibility denotes the substantive ability to claim a benefit on the groundsof qualifying conditions. Its extension comprises those who, among thoseentitled, actually fulfill the requirements set for accessing the right tobenefit, for instance on the basis of a claimant’s work and contributionrecord for social insurance, of need as operationally assessed through ameans-test for social assistance.
Coverage denotes actual benefit recipiency among a target population.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
A monetary measure of worker (in)security
We devise a comprehensive monetary measure of what one gets fromparticipation to the labor market and work-related social protection in themedium run (1998-2003).
It includes:the wage earned, net of the contributions paid to the social securityadministration and of taxes;the social protection benefits received, excluding pensions.
We define as precarious those workers whose total net income is less than60% of the median of its distribution on the whole population.
We apply 2008 fiscal and social protection rules in order to compute totalnet income (assuming no behavioral changes: we also use the historicalrules, with very small differences)
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Distribution of total net income
9.3% of workers, excluding part-time, are precarious (13.9% withpart-time)
Values in Euros (2008 prices). Right truncation at 500,000 E. The vertical line is the insecurity threshold.
Source: Own computation on WHIP data.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Precarious jobs, precarious worklife?
Matteo Richiardi Health and the crisis 46
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Dynamic microsimulation
In a life course perspective (Mayer, 2009), personal choices,socio-economic status and health conditions are interrelated.
This can be studied using dynamic microsimulations:
A dynamic microsimulation is an econometric models that forecast theevolution of some variables of interest, at the individual level, by the iterativesimulation of a number of sub-processes. These sub-processes may be
(i) estimated in the real data
(ii) taken as an outcome from other models or
(iii) arbitrarily set according to some predefined scenario.
www.jasimulation.org
Matteo Richiardi Health and the crisis 47
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Dynamic microsimulation
In a life course perspective (Mayer, 2009), personal choices,socio-economic status and health conditions are interrelated.
This can be studied using dynamic microsimulations:
A dynamic microsimulation is an econometric models that forecast theevolution of some variables of interest, at the individual level, by the iterativesimulation of a number of sub-processes. These sub-processes may be
(i) estimated in the real data
(ii) taken as an outcome from other models or
(iii) arbitrarily set according to some predefined scenario.
www.jasimulation.org
Matteo Richiardi Health and the crisis 47
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Dynamic microsimulation
In a life course perspective (Mayer, 2009), personal choices,socio-economic status and health conditions are interrelated.
This can be studied using dynamic microsimulations:
A dynamic microsimulation is an econometric models that forecast theevolution of some variables of interest, at the individual level, by the iterativesimulation of a number of sub-processes. These sub-processes may be
(i) estimated in the real data
(ii) taken as an outcome from other models or
(iii) arbitrarily set according to some predefined scenario.
www.jasimulation.org
Matteo Richiardi Health and the crisis 47
...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
LABORsim
Richiardi and Poggi (2014, Int. J. of Microsim.). Imputing Individual Effects in DynamicMicrosimulation Models. An application to household formation and labor market participation inItaly.
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
“Something more will have to be cut”Graffiti in Seville, Spain, November 2012 (Reuters / Marcelo Del Pozo).
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...and then the crisis hit (Direct) health effects Economic trends Welfare state Necessity or choice? Measures Models
Thank you for your attention.
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