Mental Illness and Unhappiness

22 Pages Posted: 5 Oct 2013

See all articles by Richard Layard

Richard Layard

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP)

Dan Chisholm

World Health Organization

Vikram Patel

London School of Hygiene and Tropical Medicine

Shekhar Saxena

World Health Organization

Abstract

This paper is a contribution to the second World Happiness Report. It makes five main points.1. Mental health is the biggest single predictor of life-satisfaction. This is so in the UK, Germany and Australia even if mental health is included with a six-year lag. It explains more of the variance of life-satisfaction in the population of a country than physical health does, and much more than unemployment and income do. Income explains 1% of the variance of life-satisfaction or less.2. Much the most common forms of mental illness are depression and anxiety disorders. Rigorously defined, these affect about 10% of all the world’s population – and prevalence is similar in rich and poor countries.3. Depression and anxiety are more common during working age than in later life. They account for a high proportion of disability and impose major economic costs and financial losses to governments worldwide.4. Yet even in rich countries, under a third of people with diagnosable mental illness are in treatment.5. Cost-effective treatments exist, with recovery rates of 50% or more. In rich countries treatment is likely to have no net cost to the Exchequer due to savings on welfare benefits and lost taxes. But even in poor countries a reasonable level of coverage could be obtained at a cost of under $2 per head of population per year.

Keywords: mental illness, welfare benefits, healthcare costs, life-satisfaction

JEL Classification: I10, I14, I18

Suggested Citation

Layard, Richard and Chisholm, Dan and Patel, Vikram and Saxena, Shekhar, Mental Illness and Unhappiness. IZA Discussion Paper No. 7620. Available at SSRN: https://ssrn.com/abstract=2336397

Richard Layard (Contact Author)

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

Houghton Street
London WC2A 2AE
United Kingdom

Dan Chisholm

World Health Organization

No Address Available

Vikram Patel

London School of Hygiene and Tropical Medicine

Keppel Street
London, WC1E 7HT
United Kingdom

Shekhar Saxena

World Health Organization ( email )

No Address Available

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