Working Paper: NBER ID: w27157
Authors: Matthew W. Ridley; Gautam Rao; Frank Schilbach; Vikram H. Patel
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 step toward the design of effective policies is to better understand the mechanisms underlying these causal effects.
Keywords: Poverty; Mental Health; Depression; Anxiety; Causal Evidence
JEL Codes: D03; I1; I3; O1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| poverty (I32) | mental illness (I12) |
| economic shocks (F69) | mental health deterioration (I12) |
| mental illness (I12) | poverty (I32) |
| cash transfer programs (F16) | reductions in suicide rates (I12) |
| mental health interventions (I12) | economic gains (O49) |