Authors
Summary
This study evaluates the mental health effects of two simultaneously implemented but conflicting policies in the UK: the National Living Wage and the benefits freeze policy. We employed the Callaway and Sant'Anna (2021) DID estimator to evaluate the heterogeneous policy effects, and we found that NLW leads to positive improvements in mental health. Also, we find the negative impact of the benefits freeze policy constricts the NLW effects. Our result is robust to the sensitivity analysis of the parallel trend assumption and the comparison group definition. Additional results support the psychosocial hypothesis that increased job satisfaction is strongly correlated with improvements in mental health. Also, we found evidence of substitution effects between work hours and leisure. Overall, our findings suggest that the effects of the NLW cannot be understood in isolation from the way the entire suite of policy instruments operates on earnings and liveable income for affected low wage workers.
Volume and page numbers
Volume: 43 , p.1185 -1208
Subjects
Notes
Open Access
This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
© 2024 The Authors. Journal of Policy Analysis and Management published by Wiley Periodicals LLC on behalf of Association for Public Policy and Management.