The Effect of Pension Income on Longevity: Evidence from Confederate Veterans

This study uses differences in pension laws between two adjacent states to investigate the causal effect of pension income longevity. I examined Confederate pensions in Texas and Oklahoma, which enacted pension laws for veterans in 1889 and 1915 respectively. Using previously collected and newer data on Confederate veterans from these states, I use the adapted Grossman model to test the effect of pension income on mortality. Since Confederate pensions represent a significant source of permanent, steady income for the veterans, I am able to determine the role of newly-endowed wealth on longevity. I found that veterans in Texas gained nearly 1.3 years (or 15 months) of additional years of life, as compared to veterans in Oklahoma. I also found that for every $10 increase in pension income, there was a 0.4% increase in years of additional life and 0.7% increase in years of life, if county-level controls are taken into consideration. The effect of an increase in pension income on longevity is large and significant.