The Effect of Welfare State Policy Spending on the Equalization of Socioeconomic Status Disparities in Mental Health

Abstract

This article examines whether and how the relationship between socioeconomic status (SES) and depression is modified by welfare state spending using the 2006, 2012, and 2014 survey rounds of the European Social Survey (ESS) merged with macroeconomic data from the World Bank, Eurostat, and SOCX database (N = 87,466). Welfare state spending effort divided between social investment and social protection spending modifies the classic inverse relationship between SES and depression. Distinguishing policy areas in both social investment and social protection spending demonstrates that policy programs devoted to education, early childhood education and care, active labor market policies, old age care, and incapacity account for differences in the effect of SES across countries. Our analysis finds that social investment policies better explain cross-national differences in the effect of SES on depression, implying policies focused earlier in the life course matter more for understanding social disparities in the mental health of populations.