Does Public Spending Level Mortality Inequalities? - Findings from East Germany after the Unification

Tobias C. Vogt, Max Planck Institute for Demographic Research
Fanny Kluge, Max Planck Institute for Demographic Research

In the course of the social, economic and political transformation following the German unification, eastern Germans have experienced large increases in life expectancy almost catching up to the level of their western compatriots. The introduction of the generous West German welfare system was accompanied by mortality reductions in particular for older East Germans. By making use of this natural experiment, we seek to quantify the effect of increasing public social security transfers on rising life expectancy. Herein, we aim at capturing how elastic mortality is to public transfers in particular to pensions and health care or in other words: how much public spending is required to increase life expectancy by one year.