Article Abstract Online ISSN: 1099-176X    Print ISSN: 1091-4358 The Journal of Mental Health Policy and Economics Volume 6, Issue 3, 2003. Pages: 123-134 Published Online: 30 Oct 2003 Copyright © 2003 ICMPE.

*Correspondence to: Dave E. Marcotte, Associate Professor, Department of Public Policy,  University of Maryland Baltimore County, 1000 Hilltop Circle, Baltimore, MD 21250, U.S.A
Tel.: +1-410-455 1455
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E-mail: marcotte@umbc.edu

Source of Funding: This research was supported by the National Institute of Mental Health (R01-MH56463-01).

Abstract

In this paper, we examine the effects of mental illness on earnings by recognizing that effects may vary across the distribution of earnings.  Using data from the National Comorbidity Survey, we employ a quantile regression estimator to identify the effects at key points in the earnings distribution. We find that earnings effects vary importantly across the distribution. While average effects are often not large, mental illness more commonly imposes earnings losses at the lower tail of the earnings distribution, especially for women. Consequently, mental illness can have larger negative impacts on economic outcomes than previously estimated, even if those effects are not uniform.

Background: The ability of workers to remain productive and sustain earnings when afflicted with mental illness depends importantly on access to appropriate treatment and on flexibility and support from employers. In the United States there is substantial variation in access to health care and sick leave and other employment flexibilities across the earnings distribution. Consequently, a worker's ability to work and how much his/her earnings are impeded likely depend upon his/her position in the earnings distribution. Because of this, focusing on average earnings losses may provide insufficient information on the impact of mental illness in the labor market. Aims: In this paper, we examine the effects of mental illness on earnings by recognizing that effects could vary across the distribution of earnings. Methods: Using data from the National Comorbidity Survey, we employ a quantile regression estimator to identify the effects at key points in the earnings distribution. Results: We find that earnings effects vary importantly across the distribution. While average effects are often not large, mental illness more commonly imposes earnings losses at the lower tail of the distribution, especially for women. In only one case do we find an illness to have negative effects across the distribution. Implications: Mental illness can have larger negative impacts on economic outcomes than previously estimated, even if those effects are not uniform. Consequently, researchers and policy makers alike should not be placated by findings that mean earnings effects are relatively small. Such estimates miss important features of how and where mental illness is associated with real economic losses for the ill.

Received 15 July 2003; accepted 21 October 2003

Copyright © 2003 ICMPE