Rethinking worrying about the stock market, but instead, anxious about employment

Abstract

AbstractUsing Engleberg's and Parsons's (2016) study (E&P) relating stock prices and hospital admissions for NJ, mental disease admits appear affected. One deviation decrease in returns of NJ/NYC‐based companies increases average daily mental disorder admits by month by 1.7% above the expected level. However, the study raises issues concerning E&P's state‐based stock price verses hospital admit conclusions by examining NJ counties’ unemployment rates compared to stock market effects on hospital admissions. Stock market effects are weak in rural and low‐income counties unless near NYC. Further, employment is a stronger explanation than stock prices and even their combination for all counties. A one percent decrease in monthly employment rate increases admits above the expected level by 3.6% across all counties. Stock prices thus seem an employment or economic proxy for NJ, rather than an independent variable.