Career Effects of Mental Health

68 Pages Posted: 6 Jan 2015 Last revised: 9 Dec 2020

See all articles by Barbara Biasi

Barbara Biasi

Yale School of Management

Michael S. Dahl

Aalborg University Business School

Petra Moser

NYU Stern Department of Economics; National Bureau of Economic Research (NBER)

Date Written: November 25, 2020

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 reduces the risk of disability for a person with BD by more than half.

Keywords: Mental Health, Earnings, Disability, Inequality, Bipolar Disorder, Depression, Schizophrenia,

JEL Classification: M13, J23, J24, O31, I12

Suggested Citation

Biasi, Barbara and Dahl, Michael Slavensky and Moser, Petra, Career Effects of Mental Health (November 25, 2020). Available at SSRN: https://ssrn.com/abstract=2544251 or http://dx.doi.org/10.2139/ssrn.2544251

Barbara Biasi

Yale School of Management ( email )

135 Prospect Street
P.O. Box 208200
New Haven, CT 06520-8200
United States

Michael Slavensky Dahl

Aalborg University Business School ( email )

Fibigerstraede 11
Aalborg Ø, 9220
Denmark

HOME PAGE: http://msdahl.net

Petra Moser (Contact Author)

NYU Stern Department of Economics ( email )

44 West 4th Street
New York, NY 10003
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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