Astrid Sophie Fugleholm defends her PhD thesis at the Department of Economics

Candidate:

Astrid Sophie Fugleholm, Department of Economics, University of Copenhagen

Title:

Mental Health and How the Economy Cares

Supervisor:

• Torben Heien Nielsen, Professor, Department of Economics, University of Copenhagen
• Mette Gørtz, Professor, Department of Economics, University of Copenhagen

Assessment Committee:

• Mette Ejrnæs, Professor, Department of Economics, University of Copenhagen
• Fabrizio Mazzonna, Professor, Department of Economics, Università della Svizzera italiana
• Peter Rønø Thingholm, Associate Professor, Department of Economics, Aarhus University

Summary:

The world is experiencing a mental health crisis. Understanding the sources of mental health deterioration and identifying potentially helpful policies is crucial for combating this crisis. My dissertation sheds light on this by exploring mental health from an economic perspective in three self-contained chapters. I evaluate reasons for mental health declines related to work and family life and why seemingly similar people receive different mental health treatments depending on their doctor. My findings highlight the importance of how the economy cares about mental health; factors such as night shift work, financial instability following spousal death, and the geographical distribution of physician specialists emerge as key determinants of individuals' mental health and their mental healthcare utilization.

Chapter 1: Sources of Variation in Mental Healthcare Utilization

With Jessica Laird and Torben Heien Nielsen

In this chapter, we investigate the role of supply- and demand-side factors in driving mental healthcare utilization. Geographic variation in mental healthcare utilization reflects an equilibrium between supply-side factors (e.g., physician practice style) and demand-side factors (e.g., patient characteristics). Understanding the sources of this variation is essential for designing healthcare systems that are both efficient and equitable. We study the sources of variation in mental healthcare utilization, separating the role of demand- and supply-side factors by exploiting patient migration and local differences in access to generalists versus specialists. Using Danish data, we document wide variation in both mental healthcare use and the practice style of general practitioners (GPs), despite the context of a universal, publicly funded healthcare system. We show that a 1 percentage point increase in a GP’s rate of providing mental healthcare leads to an increase of .31 percentage points in an individual’s own use, with women and higher-educated individuals being more sensitive than men and less-educated. From this, we calculate that 21% of the total variation in GP practice style is due to causal GP effects. Finally, we show that both local market constraints, such as the supply of physician specialists, and individual physician characteristics, such as the GP’s age and gender, play an important role in shaping practice style.

Chapter 2: Night Shift Work and Mental Health

With Søren Skotte Bjerregaard

In this chapter, we examine the mental health effects of multiple years of night shift work. Night shift work leads to inadequate sleep, which has been linked to impaired mental health. This raises a natural question: Do night shift workers suffer from poorer mental health? We examine the mental health effects of cumulative exposure to night shift work. We show that each additional year of night shift work increases the likelihood of redeeming prescriptions for mental health medication by 24%. While cumulative exposure to adverse working conditions can have more severe health consequences than temporary exposure, prior studies often underestimate these effects due to selection bias, commonly referred to as the ”healthy worker effect”; healthier workers are better equipped to remain in physically and mentally demanding jobs. We address this bias by applying a sequentially weighted matching (SWM) procedure to detailed time-stamp data from approximately 3,500 graduate nurses in Denmark, tracking their shift work schedules over six years and linking this to administrative records on their prescription medication use. Our results underscores the importance of accounting for the healthy worker effect when analyzing the health consequences of adverse working conditions and suggest that the mental health costs of night shift work may be substantially larger than previously estimated. This chapter is also a part of Søren Skotte Bjerregaard’s PhD dissertation.

Chapter 3: Survivors’ Mental Health and the Protective Role of Income Stability

With Itzik Fadlon and Torben Heien Nielsen

In this chapter, we analyze the mental health effects of spousal death and the degree to which the financial loss imposed by the health shock is a driving factor beyond the bereavement itself. We use administrative records on the universe of Danish households to characterize survivors’ mental health following their spouse’s death. We provide visually clear evidence for the immediate, large, and lingering adverse impacts and focus on studying the role of income security in driving the immediate effects. We find that, for both males and females, a large share of the spike in the takeup of mental health medication upon spousal death can be explained by the income loss imposed by the shock. Our results imply that safety-net policies can improve survivors’ mental health via the immediate liquidity they provide. This chapter has been conditionally accepted for publication at The American Economic Review: Insights, August 2025.

An electronic copy of the dissertation can be requested here: lema@econ.ku.dk