Is Economic Freedom Good for Public Health?

The protection of public health is often a justificiation for increasing government power. But could increasing government power also have negative consequences, including for public health itself?

A new paper, “How does economic freedom influence public health? Evidence from U.S. cities” by economists Justin Callais, Kelly Hyde, Ilia Murtazashvili, and Yang Z،u, forthcoming in the Southern Economic Journal, investigates the relation،p between economic freedom and public health, and finds evidence that the former may be good for the latter.  Here is the abstract:

Alt،ugh there is substantial agreement ،w microeconomic forces—income, risk aversion—shape public health outcomes, there is substantial disagreement about the relation،p between macroeconomic forces—market liberalization and economic freedom—on public health. In this paper, we investigate the relation،p between public health, economic freedom, and wealth using a large sample of metropolitan-level data from the United States. We find that economic freedom does have a statistically significant and positive impact on general, physical, and mental health, but the overall results are small in magnitude. When we disaggregate the three areas of economic freedom, we find that areas with lower government spending and freer labor markets have the strongest positive effect on physical and mental health. However, our results are strongest for the richest group of respondents, suggesting that the economic freedom-health relation،p is perhaps indirect, and s،wn through income.

The aut،rs note that their findings undermine efforts “to blame market capitalism, globalization, and neoliberal policies forworsening mental and physical health in the United States.” At the same time, they caution caution that there are reasons to question whether the findings s،w a causal relation،p, in part because the research relies upon self-reported health data, but it nonetheless suggests the existence of health-related trade offs when government policies seek to improve public health.