Economics and Finance Faculty Publications and Presentations

Diabetes and the Labor Market: The community-wide economic cost in the Lower Rio Grande Valley

Document Type

Article

Publication Date

1-2006

Abstract

Economic analyses of diabetes and diabetes treatment and prevention are increasingly common (1–11). The cost of illness studies divide costs into direct and indirect components (12,13). Indirect costs are typically those associated with limited employment-related productivity (14–18). Direct costs usually include hospital and other medical costs (19–25). While these approaches have merit at the national level, they are less applicable at the community level for two reasons. First, lost income due to diabetes translates into substantially reduced local spending for everyone in communities where the prevalence of diabetes is high. For example, in a community with high diabetes-related unemployment, income reductions related to diabetes translate into less local spending, leading to layoffs and reduced expenditures. Second, the economy of the local community partially benefits from medical expenditures, which are largely inflows from outside the community but spent locally. In this study, we use an alternative method to assess the local economic impact of diabetes: input-output analysis. We focus on a largely Mexican-American community with a 25% type 2 diabetes prevalence rate, the Lower Rio Grande Valley (LRGV) of South Texas (26). We intend to show that the standard practice of including local medical care costs is not necessary to highlight the high cost of diabetes. Further, we will demonstrate that labor productivity losses associated with diabetes adversely affect income prospects of the wider community.

Comments

© 2005 by the American Diabetes Association.

Publication Title

Diabetes Care

DOI

http://doi.org/10.2337/diacare.28.12.2945

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