We study the effect of business cycles on admissions to specialty substance abuse treatment using administrative data between 1992 and 2015. We proxy business cycles with the state unemployment rate and apply a panel fixed-effects model. While previous economic research has shown that substance abuse is counter-cyclical, we observe no change in the total number of admissions across the business cycle. However, focusing on average effects misses important heterogeneity. In substance-specific regressions we find statistically significant evidence that heroin-related admissions are counter-cyclical while stimulant-related admissions are procyclical. Our findings add to the literature on business cycles and health.
This report is part of the RAND Corporation External publication series. Many RAND studies are published in peer-reviewed scholarly journals, as chapters in commercial books, or as documents published by other organizations.
Our mission to help improve policy and decisionmaking through research and analysis is enabled through our core values of quality and objectivity and our unwavering commitment to the highest level of integrity and ethical behavior. To help ensure our research and analysis are rigorous, objective, and nonpartisan, we subject our research publications to a robust and exacting quality-assurance process; avoid both the appearance and reality of financial and other conflicts of interest through staff training, project screening, and a policy of mandatory disclosure; and pursue transparency in our research engagements through our commitment to the open publication of our research findings and recommendations, disclosure of the source of funding of published research, and policies to ensure intellectual independence. For more information, visit www.rand.org/about/principles.
The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.