Does capping social security harm health? A natural experiment in the UK

Aaron Reeves, Mark Fransham, Kitty Stewart and Ruth Patrick

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: In this paper, we examine the mental health effects of lowering the UK's benefit cap in 2016. This policy limits the total amount a household with no-one in full-time employment can receive in social security. We treat the reduction in the cap as a natural policy experiment, comparing those at risk of being capped and those who were not, and examining the risk of experiencing poor mental health both before and after the cap was lowered. Drawing on data from ~900,000 individuals, we find that the prevalence of depression or anxiety among those at risk of being capped increased by 2.6 percentage points (95% confidence interval: 1.33–3.88) compared with those at a low risk of being capped. Capping social security may increase the risk of mental ill health and could have the unintended consequence of pushing out-of-work people even further away from the labour market.

Keywords: welfare reform; mental health; benefit cap; social security (search for similar items in EconPapers)
JEL-codes: J01 R14 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2022-05-01
New Economics Papers: this item is included in nep-ban, nep-hea and nep-ias
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published in Social Policy and Administration, 1, May, 2022, 56(3), pp. 345 - 359. ISSN: 0144-5596

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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:111825

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