Unemployment and mental health
We used the Health and professional career panel to investigate the causal effect of unemployment on mental health in France. Specifically, we sought to assess whether the experience and duration of unemployment increased the incidence of so-called common mental illnesses like severe depression and generalised anxiety disorder. We referred to the history of health problems since childhood and used an instrumental variables method to take into account unobserved heterogeneity and endogeneity problems in unemployment. Our results indicate that the experience of unemployment affected men, while this was not the case for women. We also show that the main impact was on men in the second half of their career. These results are robust to our various mental health measurements. From a public policy perspective, this study shows that targeted and effective counselling for the unemployed could prevent the onset of mental illness.