Abstract: This paper sets up a quasi-experiment to estimate both total and heterogeneous impacts of medical innovations on the individual’s economic outcomes for a comprehensive set of around 90 health conditions. The rich administrative panel data for Sweden covering more than 1 million individuals combined with disease-specific data on new molecular entities and patents granted in healthcare have allowed me to emulate such an experiment. I find that an increase in medical innovations by one standard deviation raises disposable family income by 14.8% (95% CI: 14.4%; 15.1%). Regarding the sources of income response, medical innovations strongly influence not only own disposable and labour income and sickness and unemployment payments but also a spouse’s income. The effects of medical innovations are especially strong for cancer and circulatory diseases, are moderate for mental and nervous, infectious and respiratory diseases, and are absent or appear as losses for other health shocks. Results also suggest decreasing returns – yet far from reaching zeros – rather than constant returns to scale.
Abstract: This paper aims at finding whether vaccination in childhood is an important source of improved health over the life cycle and across generations. We leverage high-quality individual-level data from Sweden covering the full life spans of three generations between 1790 and 2016 and a historical quasi-experiment – a smallpox vaccination campaign. To derive the causal impact of this campaign, we employ the instrumental-variables approach and the siblings/cousins fixed effects. Our results show that the vaccine injection by age 2 improved longevity of the first generation by 14 years and made them much wealthier in adult ages. These effects, with the magnitude reduced by two thirds, persisted to the second and the third generation. Such magnitudes make vaccination a powerful health input in the very long term and suggest the transmission of environmental beyond genetic factors.
Lazuka, V., Bengtsson, P., and Svensson, P. 2021. How much did enclosures matter in Sweden? New ways to measure their impact on production. Working paper.
Abstract: The answer to how much enclosures increased production varies by context and whether direct measures, such as output or income, or indirect measures, such as farm values and rents, are used. It also varies whether the period before and after enclosures are compared, or enclosed and non-enclosed villages at a certain point in time. This paper estimates the effects of two enclosures in southern Sweden, starting in 1803 and in 1827 respectively, making use of both the information on production before and after the enclosures and compares enclosed and non-enclosed villages. It controls for farm size, natural conditions, land ownership, and other factors that might influence the production using direct measures of annual production for 1,180 farms from 1784 to 1861. Applying a difference-in-differences method, we find that during the first decade after enclosure, the grain production increased annually 1.2 percent faster than it would otherwise have done, 2.4 percent faster during the second decade. Using an event-study method, which allows for flexible modelling of pre- and post-enclosure trends, production after the enclosures increased even faster already during the first decade, annually by 3.1 percent. Apparently, the enclosures fulfilled their purpose of increasing production.