Poverty, Depression, and Anxiety: Causal Evidence and Mechanisms

43 Pages Posted: 18 May 2020

See all articles by Matthew Ridley

Matthew Ridley

Massachusetts Institute of Technology (MIT) - Economics, Finance, Accounting (EFA)

Gautam Rao

Harvard University - Department of Economics

Frank Schilbach

Massachusetts Institute of Technology (MIT) - Economics, Finance, Accounting (EFA)

Vikram Patel

Public Health Foundation of India - Centre for Chronic Conditions and Injuries; Harvard University - Harvard Medical School; Global Nature Care Sangathan Group of Institutions

Date Written: May 2020

Abstract

Why are people living in poverty disproportionately affected by mental illness? We review the interdisciplinary evidence of the bi-directional causal relationship between poverty and common mental illnesses — depression and anxiety — and the underlying mechanisms. Research shows that mental illness reduces employment and therefore income and that psychological interventions generate economic gains. Similarly, negative economic shocks cause mental illness, and anti-poverty programs such as cash transfers improve mental health. A crucial next step toward the design of effective policies is to better understand the mechanisms underlying these causal effects.

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Suggested Citation

Ridley, Matthew and Rao, Gautam and Schilbach, Frank and Patel, Vikram, Poverty, Depression, and Anxiety: Causal Evidence and Mechanisms (May 2020). NBER Working Paper No. w27157, Available at SSRN: https://ssrn.com/abstract=3603787

Matthew Ridley (Contact Author)

Massachusetts Institute of Technology (MIT) - Economics, Finance, Accounting (EFA) ( email )

77 Massachusetts Avenue
Cambridge, MA 02139-4307
United States

Gautam Rao

Harvard University - Department of Economics ( email )

Littauer Center
Cambridge, MA 02138
United States

Frank Schilbach

Massachusetts Institute of Technology (MIT) - Economics, Finance, Accounting (EFA) ( email )

77 Massachusetts Avenue
Cambridge, MA 02139-4307
United States

Vikram Patel

Public Health Foundation of India - Centre for Chronic Conditions and Injuries ( email )

India

Harvard University - Harvard Medical School ( email )

25 Shattuck St
Boston, MA 02115
United States

Global Nature Care Sangathan Group of Institutions ( email )

India

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