The tax-free year in Iceland: A natural experiment to explore the impact of a short-term increase in labor supply on the risk of heart attacks

Thorhildur Ólafsdóttir*, Birgir Hrafnkelsson, Gudmundur Thorgeirsson, Tinna Laufey Ásgeirsdóttir

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

5 Citations (Scopus)

Abstract

Evidence is mixed on whether society-wide economic conditions affect cardiovascular health and the reasons for the suggested relationship are largely untested. We explore whether a short-term increase in labor supply affects the probability of acute myocardial infarctions, using a natural experiment in Iceland. In 1987 personal income taxes were temporarily reduced to zero, resulting in an overall increase in labor supply. We merge and analyze individual-level, registry-based data on earnings and AMIs including all Icelandic men and women aged 45–74 during the period 1982–1992. The results support the prominent hypothesis of increased work as a mechanism explaining worsening heart health in upswings, for men aged 45–64 who were self-employed. We furthermore find a larger increase in probability of AMIs during the tax-free year in men aged 45–54 than men aged 55–64.

Original languageEnglish
Pages (from-to)14-27
Number of pages14
JournalJournal of Health Economics
Volume49
DOIs
Publication statusPublished - 1 Sept 2016

Bibliographical note

Publisher Copyright:
© 2016 Elsevier B.V.

Other keywords

  • Acute myocardial infarction
  • Coronary heart disease
  • Iceland
  • Labor supply
  • Natural experiment
  • CAR12
  • Myocardial Infarction
  • Coronary Disease
  • Employment
  • Work
  • Economics
  • Income Tax

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