Childhood Mental Health Effects of Early-Life Exposure to Paternal Job Loss (joint work with Vahid Moghani and Pilar García Gómez)

We study the mental health effects of early life exposure to paternal job loss. Using nationwide individual-level administrative registry records, we focus on firm-closure-induced job losses for fathers with children below age five in the Netherlands. These children are more likely to take mental health-related medicines in their later childhood, and this increase is mainly driven by psychostimulant drugs. The increased uptake of psychostimulants ranges from 6 percent of mean uptake in the control group at age five to around 7 percent at age twelve. The results from a Causal Random Forest suggest there is a large heterogeneity in the size of the effect with little to no effect on half of the children studied. In addition, father’s salary and employment sector are among the main characteristics explaining this heterogeneity. We further find that the father is more likely to take mental health medication around the time of job loss, and that the children exposed to paternal job loss are more likely to live in dissolved families. We find no evidence of exposed children living in neighborhoods with different rates of psychostimulants consumption compared to control children. These findings indicate that family environment changes such as family dissolution and paternal mental distress are the most likely pathways leading to higher mental health medication usage among children exposed to early-life paternal job loss