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Career Effects of Mental Health

Author

Listed:
  • Moser, Petra
  • Biasi, Barbara
  • Dahl, Michael S

Abstract

This paper investigates the career effects of mental health, focusing on depression, schizophrenia, and bipolar disorder (BD). Individual-level registry data from Denmark show that these disorders carry large earnings penalties, ranging from 34 percent for depression and 38 percent for BD to 74 percent for schizophrenia. To investigate the causal effects of mental health on a person’s career, we exploit the approval of lithium as a maintenance treatment for BD in 1976. Baseline estimates compare career outcomes for people with and without access in their 20s, the typical age of onset for BD. These estimates show that access to treatment eliminates one third of the earnings penalty associated with BD and greatly reduces the risks of low or no earnings. Importantly, access to treatment closes more than half of the disability risk associated with BD.

Suggested Citation

  • Moser, Petra & Biasi, Barbara & Dahl, Michael S, 2021. "Career Effects of Mental Health," CEPR Discussion Papers 16401, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:16401
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    Cited by:

    1. Baghai, Ramin & Bos, Marieke & Bach, Laurent & Silva, Rui, 2021. "How Do Acquisitions Affect the Mental Health of Employees?," Misum Working Paper Series 2021-2, Stockholm School of Economics, Mistra Center for Sustainable Markets (Misum).
    2. Dehos, Fabian & Paul, Marie & Schäfer, Wiebke & Süß, Karolin, 2024. "Time of change: Health effects of motherhood," Ruhr Economic Papers 1079, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    3. Angelucci, Manuela & Bennett, Daniel M, 2021. "The Economic Impact of Depression Treatment in India," IZA Discussion Papers 14393, Institute of Labor Economics (IZA).
    4. Sara Rellstab & Pieter Bakx & Pilar Garci‡-G—mez, 2022. "Human Capital Formation: The Effect of a Miscarriage on Mental Health, Labour Market, and Family Outcomes," Tinbergen Institute Discussion Papers 22-027/V, Tinbergen Institute.
    5. Johannes Haushofer & Robert Mudida & Jeremy P. Shapiro, 2020. "The Comparative Impact of Cash Transfers and a Psychotherapy Program on Psychological and Economic Well-being," NBER Working Papers 28106, National Bureau of Economic Research, Inc.
    6. Walsh, Brendan & Doorley, Karina, 2022. "Occupations and health," Papers BP2023/3, Economic and Social Research Institute (ESRI).
    7. Germinario, Giuseppe & Amin, Vikesh & Flores, Carlos A. & Flores-Lagunes, Alfonso, 2022. "What can we learn about the effect of mental health on labor market outcomes under weak assumptions? Evidence from the NLSY79," Labour Economics, Elsevier, vol. 79(C).
    8. Lena Janys & Bettina Siflinger, 2021. "Mental Health and Abortions among Young Women: Time-Varying Unobserved Heterogeneity, Health Behaviors, and Risky Decisions," ECONtribute Discussion Papers Series 083, University of Bonn and University of Cologne, Germany.
    9. Bencsik, Panka & Halliday, Timothy J. & Mazumder, Bhashkar, 2023. "The intergenerational transmission of mental and physical health in the United Kingdom," Journal of Health Economics, Elsevier, vol. 92(C).
    10. Janys, Lena & Siflinger, Bettina, 2024. "Mental health and abortions among young women: time-varying unobserved heterogeneity, health behaviors, and risky decisions," Journal of Econometrics, Elsevier, vol. 238(1).
    11. Eduardo Ignacio Polo-Muro, 2021. "The effect of labor market shocks on mental health outcomes: evidence from the Spanish Great Recession," Working Papers 21.08, Universidad Pablo de Olavide, Department of Economics.
    12. Petra Moser, 2016. "Patents and Innovation in Economic History," NBER Working Papers 21964, National Bureau of Economic Research, Inc.
    13. Bhuller, Manudeep & Khoury, Laura & Løken, Katrine V., 2021. "Prison, Mental Health and Family Spillovers," Discussion Paper Series in Economics 19/2021, Norwegian School of Economics, Department of Economics.
    14. Michelle Acampora & Francesco Capozza & Vahid Moghani, 2022. "Mental Health Literacy, Beliefs and Demand for Mental Health Support among University Students," Tinbergen Institute Discussion Papers 22-079/I, Tinbergen Institute.
    15. Janys, L.; & Siflinger, B.;, 2019. "Abortion and mental health: The role of selection," Health, Econometrics and Data Group (HEDG) Working Papers 19/15, HEDG, c/o Department of Economics, University of York.
    16. Sezer, Ayse Hazal, 2024. "Historical and contemporary perspectives on labor," Other publications TiSEM 88c702e1-8259-4424-b68a-d, Tilburg University, School of Economics and Management.
    17. Jensen, Mathias Fjællegaard & Zhang, Ning, 2024. "Effects of Parental Death on Labor Market Outcomes and Gender Inequalities," IZA Discussion Papers 17127, Institute of Labor Economics (IZA).
    18. Alberto Ortega, 2023. "Medicaid Expansion and mental health treatment: Evidence from the Affordable Care Act," Health Economics, John Wiley & Sons, Ltd., vol. 32(4), pages 755-806, April.
    19. Benedikt Janzen, 2022. "Temperature and Mental Health: Evidence from Helpline Calls," Papers 2207.04992, arXiv.org, revised Nov 2022.
    20. Arash Nekoei & Jósef Sigurdsson & Dominik Wehr, 2024. "The Economic Burden of Burnout," CESifo Working Paper Series 11128, CESifo.
    21. Lena Janys & Bettina Siflinger, 2021. "Mental Health and Abortions among Young Women: Time-varying Unobserved Heterogeneity, Health Behaviors, and Risky Decisions," Papers 2103.12159, arXiv.org, revised May 2022.
    22. Benjamin Ly Serena, 2021. "Revisiting Offsets of Psychotherapy Coverage," CEBI working paper series 21-05, University of Copenhagen. Department of Economics. The Center for Economic Behavior and Inequality (CEBI).

    More about this item

    Keywords

    Mental health; Earnings; And disability;
    All these keywords.

    JEL classification:

    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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