This study examines long-term distributional effects of trade on individual health using a population-based sample of German manufacturing workers matched with measures of Chinese import exposure from 1995 to 2016. Reduced-form estimates show that higher import competition increases individual healthcare utilization (self-reported physician visits) by 14% and the probability of chronic illness by 18.4%, implying a 2% annual rise in healthcare expenditure. Potential channels include: (a) income-based mechanisms affecting economic opportunity via employment, earnings and welfare reliance; (b) perception-based mechanisms such as job insecurity and income satisfaction. Results emphasize job insecurity’s role in discouraging healthcare-seeking while raising chronic illness probability. Heterogeneous effects indicate stronger utilization among female, lower-educated and long-tenured workers, with milder effects among short-tenured and technologically competitive sector workers, possibly due to job insecurity, presenteeism and disease stigma. Findings underscore the need for preventive health policies to support worker resilience and counter rising chronic care costs in Germany.
The German Chronic Meltdown: A Causal Investigation of the Link between Trade Shocks, Job Insecurity and Long-Term Individual Health
Andreea Piriu
2024
Abstract
This study examines long-term distributional effects of trade on individual health using a population-based sample of German manufacturing workers matched with measures of Chinese import exposure from 1995 to 2016. Reduced-form estimates show that higher import competition increases individual healthcare utilization (self-reported physician visits) by 14% and the probability of chronic illness by 18.4%, implying a 2% annual rise in healthcare expenditure. Potential channels include: (a) income-based mechanisms affecting economic opportunity via employment, earnings and welfare reliance; (b) perception-based mechanisms such as job insecurity and income satisfaction. Results emphasize job insecurity’s role in discouraging healthcare-seeking while raising chronic illness probability. Heterogeneous effects indicate stronger utilization among female, lower-educated and long-tenured workers, with milder effects among short-tenured and technologically competitive sector workers, possibly due to job insecurity, presenteeism and disease stigma. Findings underscore the need for preventive health policies to support worker resilience and counter rising chronic care costs in Germany.
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