Growing up with ADHD: How diagnosis shapes socioeconomic trajectories

Attention Deficit Hyperactivity Disorder (ADHD) is the most prevalent mental health disorder diagnosed in childhood in the United States, and evidence on its long-term economic consequences has largely been established using diagnosis-based measures. This paper examines how a childhood ADHD diagnosis affects adult labor market outcomes, focusing on disentangling employment effects from earnings effects and addressing sources of bias in self-reported diagnoses. Using data from Wave IV (2008-2009) of the National Longitudinal Study of Adolescent to Adult Health (Add Health), comprising 8570 participants, we implement a framework that simultaneously accounts for non-random selection into employment and measurement error arising from self-reported ADHD. Our results show that childhood ADHD substantially reduces employment probabilities in early adulthood. In contrast, once both endogeneity and selection are properly addressed, the estimated effect of ADHD on earnings conditional on employment is substantially attenuated and precisely estimated near zero. Moreover, the employment penalties in early adulthood appear less pronounced later in the life course, suggesting that the economic costs of ADHD are concentrated at labor market entry rather than persisting throughout adulthood. These findings highlight the importance of accurately measuring mental health conditions when estimating their long-term economic impact. They further suggest that policies aimed at early and systematic detection, access to care, and targeted labor-market support may yield substantial economic benefits by mitigating employment disadvantages that emerge at the transition from education to work.