Parallels in Government Spending and Suicide

Two economists say increased public health spending may lower suicide rates. But how?
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Two economists say increased public health spending may lower suicide rates. But how?

After falling during the Bush I and Clinton years, suicide rates in the United States are on an upswing, adding urgency to a long-standing academic debate over how to make sense of the cause of 32,000 American deaths per year.

Obvious answers, such as mental illness and psychological problems, are only part of the equation, according to many suicidologists. For decades, economists and other researchers have been analyzing how such macro-level indicators as unemployment, divorce, religious worship and income inequality correlate with individuals’ decisions.

A recent paper analyzes how state government affects the problem, arguing that higher public spending levels decrease the suicide rate. Yet how government policies make an impact remains an open question.

Suicide ranks in the top 10 causes of death among American males and the top 20 for women — and for every suicide, another 20 people attempt to take their own lives, according to the Centers for Disease Control and Prevention, whose published numbers run through 2005.

The conventional economic explanation for suicide, first proposed in the mid-1970s, holds that a person takes his or her own life when his or her expected lifetime utility reaches zero. The steely equation describes this utility as a function of age, income and the cost of staying alive. While much research has shown a mixed relationship between income and suicide, the studies have established that people kill themselves at least partly due to external factors, not merely due to social isolation or mental problems.

Two academics, Camelia Minoiu (then at Columbia University, now at the International Monetary Fund) and University of Castilla-La Mancha visiting professor Antonio Rodriguez Andres, noticed that few researchers had included government spending in their analyses. “We found socioeconomic variables that captured activity by the state were generally ignored,” Minoiu said.

The most comprehensive data they could obtain were state-by-state figures of health and welfare spending, expressed as a percentage of each state’s total outlay. Though these statistics encompass far more than just suicide prevention programs, Minoiu and Andres believed the numbers might act as a proxy for the quality and size of each state’s health care system and for how much of a priority governments placed on such issues.

Because they were looking at proportions and not absolute spending, their work examined how much states care about public health and welfare compared with other in-state priorities, and not how much states spend on health care per person overall. As a result, their within-state findings over time are likely more relevant than their between-state findings year to year.

The pair analyzed the figures for the 15 years leading up to 1997. Between states, and over time, the funding numbers ebbed and flowed — for instance, New Hampshire’s public health spending jumped from 14.9 percent of its budget in 1983 to 39.5 percent just nine years later.

Even with that variation, Minoiu was surprised to find that a relatively small increase in budget seemed to lead to significant decreases in the number of suicides in a state. A one-percentage-point rise in public health care spending, she said, corresponded with a 1.54 percent drop in the suicide rate. In mountain states like Nevada with relatively high rates, that would be the equivalent of saving one life per 1,000 people. Public welfare had less pronounced, while still significant, effects.

Though their data may add a new perspective to the economics of suicide, for now, the authors can offer only hypotheses as to how and why general public health and welfare spending might help stave off suicides.

“Their concepts are interesting and potentially could prove to be very significant, but a more detailed analysis is needed,” said University of Michigan professor Sean Joe.

Minoiu’s conclusions may not account for some major changes during the 1990s, such as a large jump in state Medicaid spending and the mass-market introduction of selective serotonin reuptake inhibitors (SSRIs) like Prozac.

Though confident in the results, she acknowledges that the model hasn’t been validated against states’ per-capita spending and that it doesn’t fully explain variations in suicide among females. Yet, to her, the policy implications are clear: States should consider boosting public health funding, particularly provisions to help people in distress, such as suicide hotlines and emergency centers.

Less obvious, though, is which government programs work best. That’s partly because comprehensive information on the effects of many specific programs either isn’t available or is hard to tease out from noisy data.

One study estimated that for every increase in SSRI sales of one pill per capita, the suicide rate drops by 5 percent — despite horror stories about such drugs leading people to take their own lives. Other research has lauded the cost-effectiveness of talk therapy, limiting youths’ access to firearms and establishing rules to cut the carbon monoxide content of vehicle emissions (making it more difficult to poison oneself).

A more recent paper, from a team led by Nazmi Sari at the University of Saskatchewan, examined the economic merits of two possible programs aimed at young adults aged 18 to 24. That age group has a high rate of suicide, especially among those 20 to 24 — they accounted for 2,599 deaths nationally in 2005, almost twice as many as among youth aged 15 to 19.

The researchers focused on Florida, a state that lacks suicide prevention programs aimed specifically at the college-aged. (In 2005, Florida had the 18th-highest suicide rate among 50 states and the District of Columbia, according to the American Association of Suicidology.)

They tabulated the costs of implementing general suicide education to help students learn to spot the signs of suicide and of creating peer support groups so students could help each other. They estimated general education would cost about $17 million statewide, and peer support $10 million.

While some might find it difficult to weigh those steep costs against the value of extending human life, economists do not. Suicide, it turns out, is expensive from a cold, calculating perspective as well. As the researchers point out, preventing a single suicide saves on ambulance prices ($468) and autopsy charges ($3,657.50), along with the economic productivity that a person adds to society throughout his or her lifetime. Long-term therapy and pharmacological treatment for those who survive a suicide attempt is even more costly, notes Drexel University economist Bijou Yang Lester.

Based on calculations by Sari and others, every dollar spent on the peer support program would theoretically yield social benefits equal to $3.71, with the general education program yielding $2.03. Of course, those numbers result from rosy assumptions, but the programs would likely remain worth the money even if they were only effective 20 percent of the time. To be certain, the state of Florida would have to implement the programs or wait until more data arrive from similar initiatives elsewhere.

“There are a lot of public health interventions that can prevent suicide,” said Dave Marcotte, a public policy professor at University of Maryland, Baltimore County. “Figuring out which ones are the most promising is difficult.”

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