The health implications of social security failure: evidence from the Russian pension crisis

Abstract

We explore whether health is vulnerable to income shocks, focusing on a recent crisis in Russia during which many pensioners were not paid for an extended period of time. Using panel data spanning the crisis, we find that among affected pensioners, poverty rates doubled, and the intake of calories and protein and the use of health services and medications declined significantly. These pensioners were also 5 percent more likely to die in the two years following the crisis. However, households responded in ways that mitigated the impact of the crisis, replacing one-fifth of lost pension income through increased labor supply and asset sales.