Arbeitspapier

Bounding the Causal Effect of Unemployment on Mental Health: Nonparametric Evidence from Four Countries

An important, yet unsettled, question in public health policy is the extent to which unemployment causally impacts mental health. The recent literature yields varying findings, which are likely due to differences in data, methods, samples, and institutional settings. Taking a more general approach, we provide comparable evidence for four countries with different institutional settings Australia, Germany, the UK, and the US using a nonparametric bounds analysis. Relying on fairly weak and partially testable assumptions, our paper shows that unemployment has a significant negative effect on mental health in all countries. Our results rule out effects larger than a quarter of a standard deviation for Germany and half a standard deviation for the Anglo-Saxon countries. The effect is significant for both men and women and materialises already for short periods of unemployment. Public policy should hence focus on early prevention of mental health problems among the unemployed.

Language
Englisch

Bibliographic citation
Series: IZA Discussion Papers ; No. 10652

Classification
Wirtschaft
Health Behavior
Unemployment: Models, Duration, Incidence, and Job Search
Subject
mental health
unemployment
bounds

Event
Geistige Schöpfung
(who)
Cygan-Rehm, Kamila
Kühnle, Daniel
Oberfichtner, Michael
Event
Veröffentlichung
(who)
Institute of Labor Economics (IZA)
(where)
Bonn
(when)
2017

Handle
Last update
10.03.2025, 11:44 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Cygan-Rehm, Kamila
  • Kühnle, Daniel
  • Oberfichtner, Michael
  • Institute of Labor Economics (IZA)

Time of origin

  • 2017

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