The wider effects of America’s opioid epidemic

THE IMPACT of the opioid epidemic in America is staggering. Work by Anne Case and Angus Deaton of Princeton University has indicated that overprescription of pain-relieving drugs was a big factor in the increase in mortality among middle-aged whites that has occurred since 2000. The Council of Economic Advisers has estimated that, in 2018, the costs of opioid addiction (including the value of lives lost) were $696bn, or 3.4% of GDP.

Slowly but surely, more details are emerging. In 2017 Alan Krueger, also of Princeton, showed* that labour-force participation had fallen in American counties where more opioid pain medication had been prescribed. Now a new paper** by three academics from the University of North Carolina explores the impact of the epidemic on firms and business investment.

As with Krueger’s research, the focus is on the labour market. The authors examine the change in the rate of opioid prescriptions in individual counties between 2002-06 and 2006-10, and compare it with changes in employment five years later (between 2007-11 and 2011-15).

The delay is an attempt to get round the problem of separating correlation and causation. People who are unemployed may opt for the solace of opioids. But the authors reasonably assume that “opioid prescriptions written by doctors are independent of economic...



via Business Feeds

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