Effects of Depressive Disorder on Employment Income in Brazil

Introduction Depressive disorder is prevalent worldwide, with a particularly high impact in Brazil, where it mainly affects women. While most research on depression focuses on its clinical aspects, there is a scarcity of studies exploring the economic consequences of the disorder. Objective This study aims to analyze the effect of depressive disorder on income from work in Brazil in 2008, considering both men and women and how the illness affects them differently. Methodology Two dummy endogenous variable models were estimated to assess the impact of depressive disorder on labor income. These models account for the distinct effects of the disorder on men and women, reflecting the varying characteristics of the illness's impacte. Results The findings indicate that depressive disorder reduces labor income by approximately 32.6% for women and 29.8% for men. This decrease in revenue is attributed to a reduction in individual productivity. Additionally, the illness can reduce labor supply, with some individuals leaving the labor market entirely. Conclusions The results highlight the significant economic impact of depressive disorder on labor income in Brazil. The findings suggest the need to incorporate mental health care into primary care public policies to mitigate the financial consequences of the illness