Good times make you sick

Abstract

This study uses microdata from the 1972-1981 National Health Interview Surveys (NHIS) to examine how health status and medical care utilization fluctuate with state macroeconomic conditions. Personal characteristics, location fixed-effects, general time effects and (usually) state-specific time trends are controlled for. The major finding is that there is a counter-cyclical variation in physical health that is especially pronounced for individuals of prime-working age, employed persons, and males. The negative health effects of economic expansions persist or accumulate over time, are larger for acute than chronic ailments, and occur despite a protective effect of income and a possible increase in the use of medical care. Finally, there is some suggestion that mental health may be procyclical, in sharp contrast to physical well-being.