Research report
Evidence for the 2008 economic crisis exacerbating depression in Hong Kong

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Abstract

Background

There is a lack of population-level research on the relationship between economic contraction and specific mental disorders and how individual-level variables may mediate such a relationship.

Methods

Two cross-sectional surveys using identical random sampling and diagnostic methods were conducted among Hong Kong adults in 2007 (January–February) and 2009 (April–May). 3016 and 2011 Chinese speaking adults completed structured interviews based on the criteria of Diagnostic and Statistical Manual of Mental Disorders (4th edition) (DSM-IV).

Results

The twelve-month prevalence of DSM-IV major depressive episode (MDE) was significantly higher in 2009 (12.5%) than 2007 (8.5%). A significant increase of prevalence was found in both male and female respondents, those in the highest (55–65 years) age group, having secondary education level, were married/cohabited, divorced/widowed, employed, home-making, and in the lowest and high-middle income groups. Those with large investment loss had a significantly higher prevalence of MDE (20.3%) than those with less or no-investment loss (9.2–13.7%). The symptom pattern and severity of depression in 2007 and 2009 were similar.

Conclusion

Economic contraction triggered by a global financial crisis was associated with a significant increase in the risk of depression in the Hong Kong population. This increase was not explained primarily by unemployment and had a significant contribution from employed, home-making, high-middle income, and having married people. A holistic perspective that encompasses both ecological and individual levels of analysis is essential for studying the net impact of economic contraction on depression across communities and sociodemographic groups and for health policy planning.

Introduction

Interest in a link between economic contraction and mental health is often heightened after major economic crises and has led to many speculations that demand empirical examination (Catalano, 2009, O'Dowd, 2009). Economic crises occur unexpectedly and make it difficult for researchers to examine them in a timely manner. Historically, governments might be reluctant to support psychiatric epidemiological research during economic crises because the findings were politically sensitive and might incite people to demand governmental control of social stressors (Borowy, 2008, Catalano, 1991). Some physical health indices (e.g., rates of obesity, coronary heart disease, diabetes, stroke, and accidental injuries) could improve during economic contraction because people might be forced by financial reasons to adopt a healthier life style, such as by eating less meat and walking or cycling more (Borowy, 2008). By contrast, there is a lack of population-level research on the relationship between economic contraction and specific mental disorders and the role of individual-level variables that might mediate the relationship (Catalano, 2009). This is true of the Great Depression, oil shocks of the 1970s, the Asian crisis of 1997 and, most recently, the “financial tsunami” of 2008. The latter started in September 2008 with the declaration of bankruptcy by the Lehman Brothers Holdings Inc. in the U.S. and quickly globalized to bring about recession in nearly all major economies.

Early studies on economic contraction and mental health were based mainly on time trend analysis. Some of them reported increased utilization of mental health services such as higher admission rates of psychiatric patients (Borowy, 2008, Catalano, 1991, Weaver, 1983). However, society's reduced tolerance of behavioral problems in a contracting economy might lead to greater use of police power in coercing patients into hospitalization. By contrast, reduction of discretionary spending on medical care could decrease the utilization of mental health service, especially in the early phase of an economic crisis (Catalano, 2009). Therefore, increased service utilization is weak evidence for economic turmoil exacerbating common mental disorders.

More recent studies on the relationship between economic contraction and mental health are of two main kinds. The first and more dominant type focused on job loss experienced at an individual level of economic contraction. These studies found that job loss was associated with depressive and anxiety symptoms (Catalano et al., 2000, Mandal and Roe, 2008), alcohol misuse (Catalano et al., 1993b, Khan et al., 2002), suicide (Khan et al., 2008, Gunnell, 2009) and antisocial/violent behavior (Catalano et al., 1993a). By measuring non-specific psychological distress, they did not distinguish demoralization from clinically significant mental disorders (Catalano, 1991). The other type of studies was ecological. They focused on economic contraction experienced by the general population and were based on repeated cross-sectional or longitudinal design. They produced aggregate data, mostly using unemployment rate as an indicator, that economic contraction had a moderate exacerbating effect on suicide (Chang et al., 2009, Gunnell, 2009) and antisocial/violent behaviors (Catalano et al., 1999, Kessell et al., 2006), but diminished alcohol use and related problems (Freeman, 1999, Ruhm and Black, 2002).

These two types of studies have several limitations that make the net effect of economic contraction and policy alternatives on mental health in a population hard to estimate. First, most studies were conducted in Western populations, thereby limiting their cross-cultural generalizability. For example, East Asian societies are characterized by low unemployment rates and high personal savings. The latter is related to a strong sense of shame associated with living on debt and people's practical need to save up money in view of weak welfare systems. The local experience of global economic contraction and financial insecurity may thus be different (Catalano, 1991). Second, the associations found in individual-level studies might arise from reverse causation, i.e. pre-existing mental health problems bringing about job loss in selected groups of individuals. Third, all individual-level studies and most population-level studies had focused on job loss or unemployment rate as the independent variable even though the impact of economic contraction might involve complex elements such as investment loss, reduced income, increased workload and disrupted work and family relationships. Again, these elements may vary across societies and economic crises. The final limitation is a general lack of empirical evidence from repeated cross-sectional or longitudinal population surveys to show that an economic crisis exacerbates a specific mental disorder such as depression, a leading global contributor to the burden of disease that is believed to increase in bad economic times (Catalano, 2009, WHO, 2001). Instead, many studies used non-specific symptoms, suicide and/or antisocial/violent behavior as mental health outcome variables. The rate of suicide and antisocial/violent behavior is, however, affected by many factors that may not be connected with mental disorder per se. Suicide has a low and fluctuant base rate and is associated with the most severe forms of depression that occurred only in a small subset of depressed individuals. It may not even be connected with depression at all (McCloskey et al., 2008, Lee and Kleinman, 2003). Likewise, those who remained employed during economic contraction might be inhibited from displaying antisocial behaviors because of the fear of layoff (Catalano et al., 1997, Catalano, 2009). Since depression lies on a spectrum of severity and is less likely to be inhibited, it should be a more sensitive and representative index of mental health.

As an open financial center readily exposed to global economic changes, Hong Kong was hit hard by the economic crisis of 2008. There had been four consecutive quarters of economic contraction. Unemployment rate increased modestly from 4.4% in the first quarter of 2007 to 5.3% in the second quarter of 2009 as actual layoffs occurred mostly in the financial and other economy-sensitive sectors (Census and Statistics Department, 2009a). However, what gripped people with great fear was a marked drop in the value of their financial investments. The Hong Kong Dollar (HKD) has been pegged at a rate of 7.8 HKD to 1 USD since October 17, 1983. It subsequently exhibited the same fate of devaluation and low interest rate as the USD, thereby forcing most people in Hong Kong to avoid depreciation of their assets by investing in stocks, high-interest currencies (especially the Australian Dollar), and a range of other financial products. Unfortunately, the Hang Seng Stock Index fell drastically from a historical peak (31,897) in October 2007 to 10,676 in October 2008 and fluctuated at levels lower than 16,000 till April 2009. Likewise, as nearly all asset classes plunged in value, the Australian Dollar depreciated by more than 35% relative to the HKD from July to November 2008. Consequently, the impact of investment loss following the economic crisis was deep and widespread in Hong Kong. The social impact of loss connected with the minibonds of Lehman Brothers was particularly sensational and received considerably more media coverage than news of layoffs. Seeing that their lifelong savings had evaporated, thousands of retail investors made up of ordinary citizens who held these minibonds staged repeated public protests to demand the government to take action on banks for mis-selling them as low-risk products and to hold regulators responsible for having failed to supervise banks and protect investors.

To examine the connection between the economic crisis of 2008 (i.e., population-level economic contraction) and depression in Hong Kong, we analyzed data from two general population surveys on major depressive episode (MDE) conducted in 2007 (January to February) and 2009 (April to May) respectively. The first survey was, expectedly, not conducted with the economic crisis in 2008 in mind, but was designed to examine bipolar depression (Lee et al., 2009a). The second survey was purposely designed to result in a repeated cross-sectional study. Since non-specific psychological distress was common and might spontaneously remit following an economic crisis, the second survey was conducted about 6 months after the onset of the financial turmoil when the more persistent impact of economic contraction was likely to have surfaced. Given the widespread impact of investment loss in the general public, we included an individual-level item that asked about economic contraction, namely, investment loss following the economic crisis.

Section snippets

Sampling

Hong Kong has a population of 6.9 million and 99% of the domestic households have a telephone at home (Census and Statistics Department, 2009b), with very few of them having more than one telephone line. Sampling telephone lines should generate a representative sample of households. Both surveys were approved by the Survey and Behavioral Research Ethics Committee of The Chinese University of Hong Kong. The first interviewed respondents aged between 18 and 65 years and was conducted between

Prevalence of MDE

The twelve-month prevalence estimates of MDE for the sample and those of each sociodemographic category in 2007 and 2009 were shown in Table 1. All estimates were higher in 2009 than in 2007. Statistically significant elevations in 2009 were observed in overall respondents (both male and female), the middle to high age group, those with secondary education level, married/cohabited, divorced/widowed, employed, home-makers, and in the lowest and the high-middle income groups. Among these groups,

Prevalence of depression

The present study is the first of its kind to suggest a significant increase in the prevalence of a common and clinically defined mental disorder (namely, DSM-IV major depressive episode) in a general population experiencing economic contraction triggered by a global financial crisis. We are not aware of epidemiological studies of the prevalence of MDE conducted in other communities after the economic crisis of 2008. The twelve-month prevalence of MDE we found in the 2009 survey was higher than

Role of funding source

This study did not receive any external funding.

Conflict of interest

None declared.

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