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Opioids and the Labor Market

Dionissi Aliprantis and Mark Schweitzer

No 1807, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: This paper finds evidence that opioid availability decreases labor force participation while a large labor market shock does not influence the share of opioid abusers. We first identify the effect of availability on participation using the geographic variation in opioid prescription rates. We use a combination of the American Community Survey (ACS) and Centers for Disease Control and Prevention (CDC) county-level prescription data to examine labor market patterns across both rural and metropolitan areas of the United States from 2007 to 2016. Individuals in areas with higher prescription rates are less likely to participate after accounting for standard demographic factors and regional controls. This relationship remains significant for important demographic groups when increasingly strong panel data controls, including a full set of geographic fixed effects and measures of local labor market conditions in 2000, are introduced to the regressions. We also investigate the possibility of reverse causality, using the Great Recession as an instrument to identify the effect of weak labor demand on opioid abuse. The share abusing opioids did not increase after the onset of the Great Recession. The evidence on the frequency of abuse is more ambiguous since the identified increases could be the continuation of a pre-trend.

Keywords: Opioid Prescription Rate; Labor Force Participation; Great Recession; Opioid Abuse (search for similar items in EconPapers)
JEL-codes: I10 J22 J28 R12 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-hea, nep-lma and nep-ure
Date: 2018-05-15
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