Abstract
Using wavelet methods, this paper analyzes the relationship between the age-adjusted, infant, and cause-specific mortality rates and the business cycle in Sweden over the period 1800–2000 (1911–1996 for cause-specific mortality). For the period 1800–2000, an increase in GDP by 1% decreased mortality by 0.7%. This overall relationship is due to a strong counter-cyclical relationship in the nineteenth century, which disappeared in the twentieth century. In contrast, in the twentieth century higher mortality in economic upturns is found for mortality caused by circulatory diseases (including stroke) and accidents.
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Notes
Compared to this paper, different types of harvest indices were used, rather than GDP, as business cycle indicators.
One Fourier transform is \({\rm F}(\varpi )=\int_{-\infty }^\infty {\rm f(t)e} ^{-{\rm i}\omega {\rm x}}dt,\) which builds on the Euler identity eiy = cos(y) + i·sin(y), with i being the imaginary unit.
1 US Dollar = 7.96 Swedish Krona, October 29, 2008.
The coefficients generated by MODWT are affected by the boundary condition at the beginning and the end. If the filter is of length L where (2j − 1) (L − 1) coefficients are affected for scale j, whereas (2j − 1) (L − 1)-1 beginning and (2j − 1) (L − 1) ending details and smooth coefficients are affected (Percival and Walden 2000). The Haar-Wavelet (L = 2) has the shortest possible filter length.
The Hodrick-Prescott filter is often used in macroeconomic papers to extract business cycle dynamics. The Hodrick-Prescott filter, besides serious methodological drawbacks, such as the creation of spurious cycles, does not allow for the analysis of different independent time scales, which, as we show here, might provide deeper insights into what explains the relationship between mortality and GDP.
A difference in this paper compared to Granados and Ionides (2008) is also that we use a newer historical GDP data, which is extrapolated backwards from modern official data in accordance with standards of national accounting. This implies that the data used in this paper fits much closer to official statistics for the twentieth century compared to the data in Granados and Ionides (2008), who use historical data on production and extrapolate this forward in time to the present.
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We thank two anonymous referees, Lars Hultkrantz, and seminar participants at Örebro University for helpful comments and suggestions.
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Svensson, M., Krüger, N.A. Mortality and economic fluctuations. J Popul Econ 25, 1215–1235 (2012). https://doi.org/10.1007/s00148-010-0342-8
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DOI: https://doi.org/10.1007/s00148-010-0342-8