The effect of economic recession on population health

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The effect of economic recession on population health
Stephen Bezruchka, MD MPH

Economic recessions have paradoxical effects on the mortality trends of populations in rich countries. Contrary to what might have been expected, economic downturns during the 20th century were associated with declines in mortality rates. In terms of business cycles, mortality is procyclical, meaning it goes up with economic expansions and down with contractions, and not countercyclical (the opposite), as expected. So while most nations enjoyed sustained declines in mortality during the last century, the pace of the decline has been slower during economic booms and greater during so-called busts. The first rigorous studies demonstrating this trend have appeared only in the past 9 years, although the concept is not new. In contrast, for poor countries, shared economic growth appears to improve health by providing the means to meet essential needs such as food, clean water and shelter, as well access to basic health care services. But after a country reaches $5000 to $10 000 gross national product (GNP) per capita (or gross domestic product or gross national income per capita, all of which are similar for our purposes here), few health benefits arise from further economic growth (Figure 1). Health trends in Sweden illustrate this effect.

Population health and the economy

The potential health benefits of economic progress can be affected by 2 major influences. The first is how the income generated by economic growth is used, particularly whether it is used to expand public services appropriately and to reduce the burden of poverty. The second is whether, without economic growth, the available economic resources can be used in a socially productive way. Japan presents a modern example of economic growth that was shared to reduce poverty, achieving what are today the best health outcomes in the world. Cuba, on the other hand, has not seen much economic advance, yet has achieved remarkable levels of health by using its limited resources to benefit its people. The equitable nature of health status in Cuba is reflected in, for example, the remarkably small health disparities that divide Afro-Cubans and whites in that country.

It should not be surprising that economic growth does not lead to improved health. A wide range of research studies of rich countries have revealed that greater national wealth, by nearly any measure, does not lead to better human welfare. The United States, with the highest GNP per capita in the world, has a lower life expectancy than nearly all the other rich countries and a few poor ones, despite spending half of the world’s health care bill. The United States also has the greatest levels of poverty of any rich country, with correspondingly poor health outcomes and huge health disparities. Its population’s health is on a par with that of Cuba, a poor nation that has faced economic embargoes for the past 50 years. The population of the United States is also less healthy than the population of Greece, whose economic status lies in between.

What leads to health in the industrialized countries is not absolute wealth or growth but how the nation’s resources are shared across the population. Above a certain threshold of inequality a more egalitarian income distribution within a rich country is associated with better health. As income inequality has soared in recent years in the United States, relative health improvements have dwindled and greater health disparities have emerged. In Canada, the association between income inequality and worse health, although present, is not as strong because of better social safety nets compared with the United States, where relatively few government benefits accrue to the less well off.

The procyclical nature of mortality

Beginning in the 1920s, analyses of Great Britain and the United States suggested that economic expansions were not good for health. Because of the nonintuitive nature of these findings, these studies were not taken seriously. Much later, Ruhm looked at mortality fluctuations with the economy among the 50 US states, from 1972 to 1991, for 3 age groups (20–44 years, 45–64 years, and 65 years and older), together with infant and neonatal mortality. Unemployment rates had a strong inverse relation with all of the mortality measures listed above. For example, a 1% rise in a state’s unemployment rate, relative to its historical average, was associated with a 0.5% to 0.6% decrease in total mortality. The effect was particularly strong for young adults in relation to preventable causes of death, including motor vehicle crashes, cardiovascular and liver disease, and influenza and pneumonia. The finding was thought to be related to personal behaviours such as diet, smoking, alcohol use and exercise. Ruhm found the same effect among people in the 65 and older group. The findings were not consistent for all causes of mortality, however; deaths from cancer, for example, did not display this relationship. Suicide has been found to be cyclical, meaning that rates go up during economic downturns; mental health also suffers during such periods. Although homicides do not follow a consistent pattern, age-adjusted deaths from all causes follow a consistent procyclical pattern.

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http://www.cmaj.ca/cgi/content/full/181/5/281
CMAJ • September 1, 2009; 181 (5). doi:10.1503/cmaj.090553.

All editorial matter in CMAJ represents the opinions of the authors and not necessarily those of the Canadian Medical Association.

Stephen Bezruchka is with the Departments of Health Services and Global Health, School of Public Health, University of Washington, Seattle, USA.