Bryan, M.L. orcid.org/0000-0002-5000-8946, Rice, N., Roberts, J. et al. (1 more author) (2020) Mental health and employment : a bounding approach using panel data. Working Paper. Sheffield Economic Research Paper Series, 2020006 (2020006). Department of Economics, University of Sheffield ISSN 1749-8368
Abstract
The disability employment gap is an issue of concern in most Western developed economies. This paper provides important empirical evidence on the influence of mental health on the probability of being in employment for prime age workers. We use longitudinal data and recently developed techniques, which use selection on observable characteristics to provide information on selection along unobservable factors, to estimate an unbiased effect of changes in mental health. Our results suggest that selection into mental health is almost entirely based on time-invariant characteristics, and hence fixed effects estimates are unbiased in this context. Our results indicate that transitioning into poor mental health leads to a reduction of 1.6 percentage points in the probability of employment. This is approximately 10 per cent of the raw employment gap. This effect is substantially smaller than the typical instrumental variable estimates, which dominate the literature, and often provide very specific estimates of a local average treatment effect based on an arbitrary exogenous shock. These findings should provide some reassurance to practitioners using fixed effects methods to investigate the impacts of health on work. They should also be useful to policy makers as the average effect of mental health on employment for those whose mental health changes is a highly relevant policy parameter.
Metadata
Item Type: | Monograph |
---|---|
Authors/Creators: |
|
Copyright, Publisher and Additional Information: | © 2020 The Author(s). For reuse permissions, please contact the Author(s). |
Keywords: | mental health; employment; fixed effects; oster bounds; UKHLS |
Dates: |
|
Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 23 Jun 2020 07:03 |
Last Modified: | 23 Jun 2020 15:11 |
Published Version: | https://www.sheffield.ac.uk/economics/research/ser... |
Status: | Published |
Publisher: | Department of Economics, University of Sheffield |
Series Name: | Sheffield Economic Research Paper Series |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:162222 |