Do Recessions Increase Life Expectancy?

I always urge people to examine the data. Don’t adopt a theory that makes sense until you’ve examined the data and seen the theory stand up. There are many misconceptions about finance and investing that exist because people don’t examine the data. They accept a theory that makes sense, even when the data contradict it. Here’s an example that’s not from finance and investing but shows how counterintuitive theories can be the right ones.

Recessions and unemployment increase depression and decrease overall health. That theory is supported by data. People neglect medical treatments and spend a lot of time worrying and being stressed. But life expectancies tend to increase and death rates fall during recessions. The theory is that during boom periods people engage in more life threatening activities. They drink more and gain more weight. They also work longer and are under more work-related stress. But delving into the facts even deeper reveals better theories. Read it all here.

Therefore, while grandma living longer causes the trend seen across the population, changes in her interactions with people in the workforce must explain why she lives longer in the first place. One such regular interaction takes place for the elderly living in nursing homes. For Americans over 65, the death rate for those in nursing homes drastically decreases during recessions while death rate slightly increases for those not in nursing care. Enough deaths are averted in nursing homes to compromise the entire effect among those over 65. Plus, in comparison between states, those with the greatest percentage of elderly living in nursing care saw the most substantial decrease in the death rate.