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The Causal Impact of Depression on Cognitive Functioning: Evidence from Europe

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Listed:
  • Nafilyan, Vahé

    (London School of Hygiene & Tropical Medicine)

  • Pabon, Mauricio Avendano

    (King's College London)

  • de Coulon, Augustin

    (King's College London)

Abstract

Cognitive skills are important determinants of employment and productivity in older adults. Although cognitive decline is often linked to changes in mental health, the causal nature of the association between mental illness and cognitive performance is not established. In this paper, we analyse the effect of depressive symptoms on cognitive function. Based on longitudinal data for older adults of working age, we use an instrumental variable approach to show that worsening depressive symptoms lead to a decline in cognitive skills. The economic consequences of impaired cognition caused by depressive symptoms may be a large component of mental illness's social costs.

Suggested Citation

  • Nafilyan, Vahé & Pabon, Mauricio Avendano & de Coulon, Augustin, 2021. "The Causal Impact of Depression on Cognitive Functioning: Evidence from Europe," IZA Discussion Papers 14049, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14049
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    References listed on IDEAS

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    More about this item

    Keywords

    cognitive skills; mental health; longitudinal data;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • I10 - Health, Education, and Welfare - - Health - - - General

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