Career Effects of Mental Health

58 Pages Posted: 19 Jul 2021 Last revised: 29 Apr 2022

See all articles by Barbara Biasi

Barbara Biasi

Yale School of Management; National Bureau of Economic Research (NBER)

Michael S. Dahl

Aalborg University Business School

Petra Moser

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

Multiple version iconThere are 3 versions of this paper

Date Written: July 2021

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 closes more than half of the disability risk associated with BD.

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Suggested Citation

Biasi, Barbara and Dahl, Michael Slavensky and Moser, Petra, Career Effects of Mental Health (July 2021). NBER Working Paper No. w29031, Available at SSRN: https://ssrn.com/abstract=3889138

Barbara Biasi (Contact Author)

Yale School of Management ( email )

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P.O. Box 208200
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National Bureau of Economic Research (NBER)

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Michael Slavensky Dahl

Aalborg University Business School ( email )

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Aalborg Ø, 9220
Denmark

HOME PAGE: http://msdahl.net

Petra Moser

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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