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Title page 1

Contents 1

Abstract 3

1. Introduction 4

2. Context and data 10

2.1. Mortality and life expectancy in the United Kingdom 10

2.2. Measuring the impact of austerity 10

3. Results 15

3.1. Empirical strategy 15

3.2. The welfare reform effect on life expectancy 16

3.3. The healthcare spending effect on life expectancy 18

3.4. The combined effect of austerity measures on mortality 20

3.5. Excess mortality and heterogeneous effects 22

3.6. Calculation of the marginal value of public funds 26

3.7. Distributional impact 28

4. Mechanisms and channels 29

4.1. Drug-related deaths 30

4.2. Public social benefits: Testing an income effect 33

4.3. Declining ambulance response quality 36

4.4. Impact on additional health outcomes 38

5. Conclusion 40

References 42

Appendix 46

A. Robustness Checks 46

B. Descriptive Statistics of Dataset 64

C. NHS Worforce 2009-2019 65

Tables 17

Table 1. The impact of austerity on life expectancy in the United Kingdom - welfare results 17

Table 2. The impact of austerity on life expectancy in the United Kingdom - healthcare results 19

Table 3. Calculation of marginal value of public funds 28

Table 4. The impact of austerity on drug-poisoning deaths in the United Kingdom 31

Table 5. The impact of austerity on ambulance response quality in England 37

Table 6. The impact of austerity on child obesity and diabetes in England 40

Figures 5

Figure 1. The evolution of life expectancy and public expenditure in the United Kingdom, 1999-2018 5

Figure 2. Geographic variation in life expectancy in the United Kingdom 11

Figure 3. The distribution of austerity shocks across local authority districts in the United Kingdom 12

Figure 4. The association between total welfare impact and total health impact in the regional level 14

Figure 5. The effect of the welfare austerity shock on life expectancy at birth 18

Figure 6. The effect of the healthcare austerity shock on life expectancy at birth 20

Figure 7. The effect of the combined healthcare and welfare austerity shock on life expectancy at birth 21

Figure 8. The effect of austerity measures on life expectancy in the United Kingdom 23

Figure 9. The effect of the combined healthcare and welfare austerity shock on mortality 24

Figure 10. Excess mortality caused by austerity by age group (2010-2019) 25

Figure 11. The association between life expectancy improvement and income in the United Kingdom, 2010-2019 29

Figure 12. Age-adjusted drug-poisoning mortality rate per 100,000 people in England and Wales between 2001 and 2019 30

Figure 13. The effect of the combined healthcare and welfare austerity shock on drug-poisoning mortality 32

Figure 14. The impact of austerity on social benefits for women aged 40-49 and elderly households 35

Figure 15. Ambulance response quality in the England 2008-2017 36

Figure 16. The effect of the combined healthcare and welfare austerity shock on prevalence of obesity among 10-11-year-olds 39

Appendix Tables 49

Table A.1. The impact of austerity on life expectancy in the United Kingdom - jointly estimating austerity and unemployment shocks 49

Table A.2. The impact of austerity on life expectancy in the United Kingdom - welfare results; local authority vs. region results 54

Table A.3. The impact of austerity on female life expectancy at birth in the United Kingdom - healthcare results; alternative treatment definitions 56

Table A.4. The impact of austerity on life expectancy in the United Kingdom before 2016 60

Table B.1. Descriptive statistics of key variables 64

Appendix Figures 47

Figure A.1. Sensitivity analysis for different treatments and outcomes in the main analysis 47

Figure A.2. The welfare shock and the recession economic shock across local authorities in the United Kingdom 48

Figure A.3. The effect of the combined healthcare and welfare austerity shock on life expectancy at birth, with and without accounting for the unemployment shock 50

Figure A.4. The association between life expectancy and exposure to austerity 51

Figure A.5. The total relative impact effect on life expectancy by level of deprivation 51

Figure A.6. The effect of binary treatment on female life expectancy at birth 53

Figure A.7. The effect of the welfare austerity shock on life expectancy at birth 55

Figure A.8. The effect of the health shock on female life expectancy at birth 57

Figure A.9. The effect of additional austerity measures on female life expectancy at birth 59

Figure A.10. The effect of austerity measures on female life expectancy at birth by 2015 60

Figure A.11. Crude mortality rates in the United Kingdom, 2002-2019 61

Figure A.12. Cardiovascular disease mortality rates in the United States (black) and the United Kingdom (blue), 2000-2019 62

Figure A.13. The association between exposure to austerity and CVD mortality rate 63

Figure A.14. Parallel trends in CVD mortality across exposure levels to austerity 63

Figure C.1. Full-time equivalent NHS workforce per capita in England, 2009-2019 65

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