Published on Development Impact

Sadness interfering with work: depression and labor supply in developing countries

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If economists view mental health as one component of human capital, as we typically view physical health, then it’s a natural step to the corollary view that good mental health leads to productivity enhancing behaviors such as increased labor supply, greater effort, enhanced concentration, and so on. Given its productive role perhaps mental health, often neglected in the policy realm, deserves more attention. Unfortunately there are precious few studies till date that actually establish such a link between psychological health and productivity.

Yes, there are a fair number of associational studies that link poverty and poor mental health, mostly in developed economies. And yes, the causal relation between poverty and ill mental health can, and likely does, flow both ways (with the predominant causal direction depending in part on the specific type of mental illness). But since this is an impact evaluation blog, I focus on evaluations of mental health interventions that contain rigorous counterfactual inference. And with this lens there’s actually very little research out there, even in developed economies.

One of the few examples that I have found is from Schoenbaum and co-authors that randomize depressive patients into one of two types of anti-depression treatment. This study was primarily focused on determining the relative effectiveness of the two contrasting approaches, but the researchers also measured some basic economic-related patient outcomes. It turned out that the group assigned to the more effective course of treatment  not only had lower rates of depressive disorder (24 percent versus 70 percent) but also significantly higher rates of employment – 72 percent versus 53 percent. So here is a fairly definitive result, albeit one data point based on 46 primary care clinics in five states in the US.

For developing economies, the link between mental health and economic outcomes is shrouded in even more mystery. A recent review paper as part of the Lancet’s 2011 series on global mental health drives this point home. Lund and co-authors conduct an extensive search for studies evaluating mental health interventions (broadly defined) that contained both a valid counterfactual and measures of economic outcomes. From an initial retrieval of 9132 abstracts, selected due to the presence of key terms, the screening filters reduced the final number of studies in the review to nine!

If we concentrate specifically on depression, the most common mental disorder in the developing world according to Global Burden of Disease estimates, then we are left with three randomized cluster trials in three disparate settings:

-          Bolton and co-authors assess a group based approach to interpersonal psychotherapy among depressed patients in rural Uganda. The groups were successful in reducing depression severity – after the study period 7% of the treatment group met the criteria for major depression while 55% in the control group did so. At the same time, women in the intervention group reported significantly higher rates of activities that included child care, growing food, and participating in community activities. For men, the results were not as definitive although treated men were more likely to engage in manual labor (significant at the 10% level) but no more likely to farm.

-          Hu, Wang, and Fu assess what they term “synthetical family treatment” against “common clinic service” among a group of depressed patients recently discharged from hospital (it’s difficult for me to understand the exact nature of the intervention since the entire paper excepting the abstract is in Chinese). The synthetic family treatment is more successful in reducing depression and the patients assigned to the group were significantly more likely to be working full-time: 87% vs. 68%

-          Patel and co-authors assess two approaches to the treatment of depressive patients, a course of anti-depressants or a short course of psychological treatment by a trained therapist, against a placebo. Even though full adherence to the anti-depressant was a problem, the group assigned to this treatment arm did report significantly better mental health after two-months (benefits after one year of study were not as clear). Aggregated patient costs, which include lost work days, were significantly less for the anti-depressant group. No benefits were observed among the group assigned to psychological treatment.

If these are the existent studies that can link efficacious anti-depression interventions to economic outcomes – three small scale cluster randomized trials with limited economic measures and fairly mixed results – then clearly the evidence to date is underwhelming. But of course the absence of evidence does not imply the evidence of absence. So here is a plea to mental health researchers currently investigating the effectiveness of their interventions (or soon to do so): by adding even a few basic economic outcomes to the assessed patient measures, the evidence base can be dramatically broadened.

By firmly establishing a connection between mental health and productivity (if one does exist) through repeated empirical work, advocates that argue for an increased focus on mental health in development policy will have an important piece of ammunition. In a future post I’ll explore in more detail the logic behind this broader argument that links mental health and inclusive development policy.




Jed Friedman

Lead Economist, Development Research Group, World Bank

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