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This chapter uses quarterly county-level data from 2006 to 2014 to examine the direction of causality in the relationship between per capita opioid prescription rates and employment-to-population ratios. We first estimate models of the effect of per capita opioid prescription rates on employment-to-population ratios, instrumenting opioid prescriptions for younger ages using opioid prescriptions to the elderly. We find that the estimated effect of opioids on employment-to-population ratios is positive but small for women, while there is no relationship for men. We then estimate models of the effect of employment-to-population ratios on opioid prescription rates using a shift-share instrument and find ambiguous results. Overall, our findings suggest that there is no simple causal relationship between economic conditions and the abuse of opioids. Therefore, while improving economic conditions in depressed areas is desirable for many reasons, it is unlikely on its own to curb the opioid epidemic.

This study uses data from the British National Child Development Survey (NCDS) to examine interactions between socio-economic status (SES), children's test scores, and future wages and employment. We find that children of lower SES have both lower age 16 test scores and higher returns to these test scores in terms of age 33 wages and employment probabilities than high-SES children.

We then examine determinants of age 16 scores. Conditional on having had the same age 7 mathematics scores, high-SES children go on to achieve higher age 16 mathematics scores than children of low or middle-SES. They are also much more likely to pass O-levels in English and Mathematics. These differences are either eliminated or greatly reduced when observable measures of school quality are added to the model, suggesting that high-SES children get better age 16 test scores at least in part because they attended better schools.

On the other hand, conditional on age 7 scores, low-SES children achieve higher age 16 reading scores than high-SES children and the estimated relationship between the two is not affected by the addition of school quality variables. This observation provides evidence consistent with the conjecture that success in reading may be less dependent on school quality than success in mathematics.