2015 Nobel prize winning economist Angus Deaton spoke to Trinity students today in an event jointly organised by The Hist and The Student Economic Review where he claimed that the mortality rate of lower class white Americans has increased.
Focusing on the topic of rising inequality in the first world and its effects on societal development, Deaton discussed his upcoming studying analysing the increase in mortality rate amongst middle aged Americans, which will be released tomorrow.
The mortality rate’s increase, Deaton claims, is responsible for the extra deaths of half a million people since 1998, which he estimates is when it first emerged. According to Deaton, it’s almost entirely confined to lower class white Americans and is a by-product of the increase in drug overdoses, suicides, and liver diseases relating to alcohol amongst that cohort.
Deaton’s calls this ‘disturbing’ since first world countries have grown accustomed to seeing all long-term mortality rates decrease over the last century, which is seen as a part of the parcel of economic development.
One of the causes Deaton explores is rising inequality. Inequality can be good for society when it creates incentives, ‘if I see you get ahead, I’ll try to get ahead,’ explains Deaton. This results in economic development. ‘You can’t think progress is good, and inequality is bad.’
However, Deaton also claims to be ‘terrified of [inequality],’ as it can create incentives to reduce progress when not applied properly. For example, old technologies may try to prevent an improved product from entering the market, which prevents others from improving their situation. Successful people ‘should be helping people coming behind them…but sometimes they pull up the ladder instead,’ he believes.
One of the problems, Deaton argues, is that some successful people are reluctant to admit that luck, alongside their hard work, plays an important role in their success. Deacon offers his own life as an example, retelling how he was lucky to be born after his father was nearly sent on a fatal mission to Norway during world war two.
Economic prosperity, because of the element of luck, is a product of society and should be enjoyed by all society. But increasingly, inequality has been creating much greater private returns than social returns, which is leading to concern.
The other cause Deaton discusses is the proliferation of unnecessary drugs. Alongside cheaper illegal drugs, Deaton argues that some of the increase is the result of bad marketing by pharmaceuticals. Pharmaceuticals, he argues, have been selling highly addictive drugs but marketing them as non-addictive.
The legal repercussions against such behaviour have not been strong enough. ‘Pharmaceuticals have brought benefits to the world but if it allows them to commit crimes in impunity, then they’ve gone rogue,’ he claims.
Although the increase in mortality is currently confined to a specific age bracket within the U.S, he discusses whether it is the harbinger of the end of economic development.
‘We’ve been conditioned to think economic growth could go on forever,’ since it has been rising for over 200 years, however, human beings have been around for about a million years and ‘there were episode of economic growth in China and Africa before, which didn’t last.’
Alongside the falling mortality rate, there are two other treats to economic development, Deaton claims, these include climate change and the apparent slowing down of economic development in wealthier countries.
While these are things we need to discuss, Deaton claims to be ‘soberly’ optimistic about our future, for the reason that whatever happens the knowledge we learned over the last couple of centuries will likely still exist. ‘Ever since the enlightenment, people have known that they can achieve better lives for themselves; that, for me, is evidence that we’re not going to slip into the middle ages.’