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CRES-Seminar: Gabriel Facchini

CRES-Seminar: Gabriel Facchini

"Welfare Dependency and Productivity Effects of Health Shocks: Evidence from Dengue Outbreaks in Brazil" Sonia Bhalotra, Gabriel Facchini, Aline Menezes, Rudi Rocha.

  • Date: 16th of May at 11:00h

  • Room: 23.103 (Ciutadella Campus, Universitat Pompeu Fabra, Barcelona).

09.05.2019

 

Gabriel Facchini

"Welfare Dependency and Productivity Effects of Health Shocks: Evidence from Dengue Outbreaks in Brazil" Sonia Bhalotra, Gabriel Facchini, Aline Menezes, Rudi Rocha.

ABSTRACT:

Although understanding the role of health in driving labor market outcomes is a matter of great importance, it has proven difficult to isolate this effect due to empirical challenges and a lack of compelling sources of identification. We rely on instrumental variables and novel datasets to obtain causal estimates of the effect of health shocks (dengue) on income and welfare dependency. In a first part, we exploit exogenous variation in weather conditions (i.e. temperature and relative humidity) that the epidemiology literature has found to be particularly suitable for the population dynamics of the vector species. We find that a higher dengue incidence in the local labor market area has a negative effect on the number of hours worked and labor income, especially for more vulnerable groups (i.e. self-employed and women). In a second part, we use a rich administrative data set of welfare recipients (Cadunico) linked to dengue cases at the individual level. We confirm our previous results, and observe that the effect on earnings is greatly compensated by conditional cash transfers (Bolsa Familia) –that help insulate households from this shock. Altogether, this evidence suggest that health shocks are an important part of income, poverty and welfare dependency

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