Cash Transfers and Mental Health: Evidence From South Africa

Kevin Feeney , University of Southern California

By 2040, over 70% of the world's dementia burden will come from low/middle income countries, yet we know little about the types of interventions that can ameliorate the impacts of this costly disease. Current literature has emphasized the role of early life environment on later life cognitive health, but economic welfare policies targeting aging individuals currently at risk for cognitive decline may also be important. In this paper, I show cash transfers have the potential to improve cognitive outcomes in developing economies, focusing on one such program in South Africa. I show the improvements in cognition are likely attributable to better subjective wellbeing and decreased stress and depression. I consider additional mechanisms, such as improvements to cardiovascular disease management and better nutrition, but find weak evidence for these channels. The results have important implications for how public policies can affect health and wellbeing in low income settings experiencing demographic transitions.

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 Presented in Session 216. Health Effects of Social Welfare Policies