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Source: Sung-Hee Joen and Vincent Pohl, “Medical Innovation, Education, and Labor Market Outcomes of Cancer Patients” (March 7, 2019).
Commentary: Medical innovations have been credited with extending lifespans and improving people’s overall quality of life. However, the positive economic effects, specifically on the labor market, are not well known. Economists Sung-Hee Joen and Vincent Pohl examined the effects of cancer treatment innovations, measured by patents and novel drugs, in the Canadian labor market from 1992 to 2010, using data on almost 20,000 prostate and breast cancer patients. They found that prostate cancer patients who received the new treatments were 1.8 percent less likely to work five years after the diagnosis, versus being 3.8 percent less likely to work without the new treatments, a 70 percent improvement. For breast cancer patients, the effects were similar in that, without new treatments, patients were 4.9 percent less likely to work after their diagnosis versus being 1.8 percent less likely to work with new treatments, a 63 percent improvement. These strong effects point to the tremendous spillover benefits that medical innovations have on the labor market and the economy as a whole.