IDEAS home Printed from https://ideas.repec.org/p/ucd/wpaper/202201.html
   My bibliography  Save this paper

The impact of adolescent psychological distress on access and participation in employer sponsored pension plans in the US

Author

Listed:
  • Karen Arulsamy

    (Geary Institute for Public Policy, University College Dublin)

Abstract

A large body of evidence shows that poor mental health early in life reduces income over the lifespan, but a dearth of evidence exists on how early psychological distress affects long-term savings behaviour. By employing a nationally representative cohort panel (NLSY1997) and linear probability models, this paper provides novel evidence that poor mental health early in life can have persistent effects on lifelong financial security via lower retirement savings. Adolescents (16 to 20 years old) with poor mental health are 4.7 percentage points less likely to have access to and 8.9 percentage points less likely to participate in employer sponsored pension plans at age 30-35. There is no significant difference in pension participation rates when individuals with poor mental health have access to plans. The negative association between adolescent mental health and pension participation is mediated by access to a plan, education, income and employment status. These findings suggest that selection into less favourable employment conditions perpetuated by early mental health problems lowers access to and participation in employer sponsored pension plans.

Suggested Citation

  • Karen Arulsamy, 2022. "The impact of adolescent psychological distress on access and participation in employer sponsored pension plans in the US," Working Papers 202201, Geary Institute, University College Dublin.
    • Handle: RePEc:ucd:wpaper:202201
    as

    Download full text from publisher

    File URL: http://www.ucd.ie/geary/static/publications/workingpapers/gearywp202201.pdf
    File Function: First version, 2021
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bubonya, Melisa & Cobb-Clark, Deborah A. & Wooden, Mark, 2017. "Mental health and productivity at work: Does what you do matter?," Labour Economics, Elsevier, vol. 46(C), pages 150-165.
    2. Knapp, Martin & Wong, Gloria, 2020. "Economics and mental health: the current scenario," LSE Research Online Documents on Economics 102717, London School of Economics and Political Science, LSE Library.
    3. Arulsamy, Karen & Delaney, Liam, 2022. "The impact of automatic enrolment on the mental health gap in pension participation: Evidence from the UK," Journal of Health Economics, Elsevier, vol. 86(C).
    4. Evans-Lacko, Sara & Knapp, Martin & McCrone, Paul & Thornicroft, Graham & Mojtabai, Ramin, 2013. "The mental health consequences of the recession: economic hardship and employment of people with mental health problems in 27 European countries," LSE Research Online Documents on Economics 51632, London School of Economics and Political Science, LSE Library.
    5. Annamarie Lusardi & Olivia S. Mitchell, 2005. "Financial Literacy and Planning: Implications for Retirement Wellbeing," Working Papers wp108, University of Michigan, Michigan Retirement Research Center.
    6. Jason M. Fletcher, 2010. "Adolescent depression and educational attainment: results using sibling fixed effects," Health Economics, John Wiley & Sons, Ltd., vol. 19(7), pages 855-871, July.
    7. Khwaja, Ahmed & Silverman, Dan & Sloan, Frank, 2007. "Time preference, time discounting, and smoking decisions," Journal of Health Economics, Elsevier, vol. 26(5), pages 927-949, September.
    8. Sara Evans-Lacko & Martin Knapp & Paul McCrone & Graham Thornicroft & Ramin Mojtabai, 2013. "The Mental Health Consequences of the Recession: Economic Hardship and Employment of People with Mental Health Problems in 27 European Countries," PLOS ONE, Public Library of Science, vol. 8(7), pages 1-7, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mousteri, Victoria & Daly, Michael & Delaney, Liam & Tynelius, Per & Rasmussen, Finn, 2019. "Adolescent mental health and unemployment over the lifespan: Population evidence from Sweden," Social Science & Medicine, Elsevier, vol. 222(C), pages 305-314.
    2. Arulsamy, Karen & Delaney, Liam, 2022. "The impact of automatic enrolment on the mental health gap in pension participation: Evidence from the UK," Journal of Health Economics, Elsevier, vol. 86(C).
    3. Bjørnshagen, Vegar, 2021. "The mark of mental health problems. A field experiment on hiring discrimination before and during COVID-19," Social Science & Medicine, Elsevier, vol. 283(C).
    4. Margot Annequin & France Lert & Bruno Spire & Rosemary Dray-Spira & and the ANRS-Vespa2 Study Group, 2016. "Increase in Unemployment over the 2000’s: Comparison between People Living with HIV and the French General Population," PLOS ONE, Public Library of Science, vol. 11(11), pages 1-17, November.
    5. Fabrizio Starace & Francesco Mungai & Elena Sarti & Tindara Addabbo, 2016. "Being hit twice: The psychological consequences of the economic crisis and an earthquake," International Journal of Social Psychiatry, , vol. 62(4), pages 345-349, June.
    6. Panagiotis Volkos & Emmanouil K Symvoulakis, 2021. "Impact of financial crisis on mental health: A literature review ‘puzzling’ findings from several countries," International Journal of Social Psychiatry, , vol. 67(7), pages 907-919, November.
    7. Ketevan Glonti & Vladimir S Gordeev & Yevgeniy Goryakin & Aaron Reeves & David Stuckler & Martin McKee & Bayard Roberts, 2015. "A Systematic Review on Health Resilience to Economic Crises," PLOS ONE, Public Library of Science, vol. 10(4), pages 1-22, April.
    8. Egan, Mark & Daly, Michael & Delaney, Liam, 2015. "Childhood psychological distress and youth unemployment: Evidence from two British cohort studies," Social Science & Medicine, Elsevier, vol. 124(C), pages 11-17.
    9. Marina Economou & Lily Evangelia Peppou & Kyriakos Souliotis & Helen Lazaratou & Konstantinos Kontoangelos & Sofia Nikolaidi & Alexandra Palli & Costas N Stefanis, 2019. "Attitudes to depression and psychiatric medication amid the enduring financial crisis in Attica: Comparison between 2009 and 2014," International Journal of Social Psychiatry, , vol. 65(6), pages 479-487, September.
    10. Evans-Lacko, Sara & Knapp, Martin, 2014. "Importance of social and cultural factors for attitudes, disclosure and time off work for depression: findings from a seven country European study on depression in the workplace," LSE Research Online Documents on Economics 56307, London School of Economics and Political Science, LSE Library.
    11. Dorrit Posel & Adeola Oyenubi & Umakrishnan Kollamparambil, 2021. "Job loss and mental health during the COVID-19 lockdown: Evidence from South Africa," PLOS ONE, Public Library of Science, vol. 16(3), pages 1-15, March.
    12. Sara Evans-Lacko & Martin Knapp, 2014. "Importance of Social and Cultural Factors for Attitudes, Disclosure and Time off Work for Depression: Findings from a Seven Country European Study on Depression in the Workplace," PLOS ONE, Public Library of Science, vol. 9(3), pages 1-10, March.
    13. Egan, Mark & Daly, Michael & Delaney, Liam, 2016. "Adolescent psychological distress, unemployment, and the Great Recession: Evidence from the National Longitudinal Study of Youth 1997," Social Science & Medicine, Elsevier, vol. 156(C), pages 98-105.
    14. Posel, Dorrit & Oyenubi, Adeola, 2023. "Heterogeneous gender gaps in mental wellbeing: Do women with low economic status face the biggest gender gaps?," Social Science & Medicine, Elsevier, vol. 332(C).
    15. Paul McNamee & Silvia Mendolia & Oleg Yerokhin, 2021. "The transmission of partner mental health to individual life satisfaction: Estimates from a longitudinal household survey," Scottish Journal of Political Economy, Scottish Economic Society, vol. 68(4), pages 494-516, September.
    16. Claire Henderson & Petra C. Gronholm, 2018. "Mental Health Related Stigma as a ‘Wicked Problem’: The Need to Address Stigma and Consider the Consequences," IJERPH, MDPI, vol. 15(6), pages 1-13, June.
    17. Leinonen, Taina & Laaksonen, Mikko & Chandola, Tarani & Martikainen, Pekka, 2016. "Health as a predictor of early retirement before and after introduction of a flexible statutory pension age in Finland," Social Science & Medicine, Elsevier, vol. 158(C), pages 149-157.
    18. Fabrizio Starace & Francesco Mungai & Elena Sarti & Tindara Addabbo, 2017. "Self-reported unemployment status and recession: An analysis on the Italian population with and without mental health problems," PLOS ONE, Public Library of Science, vol. 12(4), pages 1-13, April.
    19. Giuseppina Maria Cardella & Brizeida Raquel Hernández-Sánchez & José Carlos Sánchez-García, 2021. "Development and validation of a scale to evaluate students’ future impact perception related to the coronavirus pandemic (C-19FIPS)," PLOS ONE, Public Library of Science, vol. 16(11), pages 1-23, November.
    20. Kovács Erzsébet & Vaskövi Ágnes, 2020. "Pension Pessimism in the Young Generation: Basics or Instincts to Blame?," Business Systems Research, Sciendo, vol. 11(2), pages 117-131, October.

    More about this item

    Keywords

    Mental health; psychological distress; pensions; retirement savings; financial security; longitudinal studies; cohort studies;
    All these keywords.

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucd:wpaper:202201. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Geary Tech (email available below). General contact details of provider: https://edirc.repec.org/data/geucdie.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.