Mind after Matter: Evidence of the Mental Health Effects of Random Exogenous Health Shocks

Manoj Mohanan, Harvard University
Joanna Maselko, Temple University

Estimating the causal role of physical illness in contributing to the high global burden of mental illness has been difficult due to problems of endogeneity. We employ a novel study design by estimating mental health consequences of a random exogenous health shock: being a passenger in a bus accident. Using compensation data from Karnataka, India to identify the exposed and matching on age, sex, and geographic area to identify the unexposed, we compare psychological distress levels across exposure groups one year later. Mean psychological distress level among the exposed was 1.5 standard deviations higher than among the unexposed. After adjusting for disability, household debt and demographic variables, the difference was half a standard deviation. Exposed individuals were over 6 times likely to report levels of distress consistent with a psychiatric diagnosis. Our findings suggest that even relatively small physical health shocks have significant and lasting causal effects on mental health.