Scandinavian Working Papers in Economics

Working Paper Series, Center for Labor Studies,
Uppsala University, Department of Economics

No 2014:10: Income receipt and mortality - Evidence from Swedish public sector employees

Elvira Andersson (), Petter Lundborg () and Johan Vikström ()
Additional contact information
Elvira Andersson: Department of Economics and Centre for Economic Demography, Postal: Lund University, P.O. Box 7082, S-220 07 Lund, Sweden.
Petter Lundborg: Lund University, and IZA, Postal: Department of Economics and Centre for Economi, Demography
Johan Vikström: Uppsala Center for Labor Studies, Postal: Department of Economics, Uppsala University, P.O. Box 513, SE-751 20 Uppsala, Sweden

Abstract: In this paper, we study the short-run effect of salary receipt on mortality among Swedish public sector employees. By using data on variation in pay-days across work-places, we completely control for mortality patterns related to, for example, public holidays and other special days or events coinciding with paydays and for general within-month and within-week mortality patterns. We find a dramatic increase in mortality on the day salaries arrive. The increase is especially pronounced for younger workers and for deaths due to activity-related causes such as heart conditions and strokes. Additionally,the effect is entirely driven by an increase in mortality among low income individuals, who are more likely to experience liquidity constraints. All things considered, our results suggest that an increase in general economi activity on salary receipt is an important cause of the excess mortality.

Keywords: Income; Mortality; Health; Consumption; Liquidity constraints; Permanent income hypothesis

JEL-codes: D91; H31; H55; I10; I12; I38

29 pages, August 10, 2014

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