Early life exposure to recessions and adult mental health

Abstract: Mental illness has increasingly become a problem throughout the world and is believed to cost the global economy $16 trillion by 2030. Consequently, a growing body of literature investigates the possible causes of mental illness and more specifically, possible early life circumstances which may affect adult mental health. Limited research exists though in terms of exposure to recessions in utero and early life and adult mental health. Thus, the purpose of this study is to investigate this relationship. By using data from the World Health Survey and recession data from the Barro-Ursua Macroeconomic Dataset, which covers more than 26 000 individuals in 20 countries, three dimensions of exposure are taken into consideration. These dimensions comprise of in utero exposure, early life (0-4 years) exposure and the number of years living through a recession. A fixed effects model controlling for country-, year-of-birth as well as survey-year effects is used. The results suggest that no significant relationship between in utero and early life exposure to recessions and adult mental health can be found. Neither does there exist a significant relationship between the number of years living through a recession and adult mental health. The results remain stable throughout several heterogeneity- and robustness checks. The results suggest that either no actual relationship exists or that recession data is too diffuse in terms of timing to capture any effects that may be present. Future research should therefore further investigate this relationship using elaborate measures and to a greater extent sample developed countries, to capture any underlying mechanisms that may play an important role.