UC San Diego

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 take-up 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. (JEL D12, D91, G51, H55, I12, I38, J16)