The Effect of Minimum Wages on “Deaths of Despair”

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In 2017, economists Anne Case and Angus Deaton coined the phrase “deaths of despair” to describe a troubling rise of Americans dying from suicide, drugs (including opioids) and alcoholism. Experts across the country are now attempting to tease apart the complex factors driving these trends, but until now, no one has examined the potentially causal effects of decreases in real minimum wages in relation to this trend or the potential benefits of rising minimum wages in counteracting other drivers of this trend, despite a strong evidence base linking income and health.

Recently-enacted higher state and local minimum wage laws—in the $12 to $15 range—are increasing incomes of low-income families by more than government spending on the three main safety net programs—Temporary Assistance for Needy Families, Earned Income Tax Credit, and the Supplemental Nutrition Assistance Program—combined. The research team will take advantage of historical and recent policy shifts to examine the relationship between changes to federal, state, and local minimum wages and overall death rates, using CDC Vital Statistics data. Their exploration will help us understand a potentially critical factor driving US mortality trends, and add to the existing literature about the reverberating effects of income policies on people’s health and well-being.

Principal Investigators: Michael Reich, University of California, Berkeley

Evidence

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William H. Dow, Anna Godoey, Christopher Lowenstein and Michael Reich released a National Bureau of Economic Research Working Paper investigating whether “deaths of despair” respond to two key policies that raise incomes for low-wage workers: the minimum wage and the Earned Income Tax Credit (EITC).