Maggio 23, 2022

Women’s Mental Health and Financial Empowerment


In India, gender is a crucial determinant of mental health (Malhotra & Shah, 2015). The prevalence of common mental health disorders such as depression and anxiety is higher among women than men. Women are also more likely to be financially vulnerable and face gendered financial risks. They receive lower wages than men for casual labor (World Bank, 2009) and constitute a significant share of agricultural labor , but own less than 10% of agricultural land. Social norms and cultural factors also inhibit smart phone access and use among women and girls (Barboni, 2018). This restricts access to financial products, information and opportunities. Given that financial vulnerability and mental ill-health share a bidirectional causal relationship – where mental illness causes lower employment and income and negative economic shocks can lead to mental illness (Ridley, 2020), exploring the links between women’s financial security and mental well-being is of interest.


Women’s financial empowerment, which includes financial inclusion or access to a range of financial services – savings, payment facilitation, insurance, credit and the associated training and education, has been discussed as an important policy lever to enhance both economic and social empowerment. Its mental health impacts, however, remain underexplored. In a randomized controlled trial (RCT) in 197 village clusters in Madhya Pradesh, banks pushed to open personal bank accounts for women in a random subset of these clusters. Researchers then randomized whether women’s wages for work done under MNREGA were deposited in their own (the ‘treatment’) or their husband’s (the status quo) bank accounts. They also cross-randomized* a training program that provided instruction on accessing bank kiosks or customer service centers near the women’s homes (Field, 2019). They find that direct deposits and training increase women’s financial inclusion, banking autonomy, labor market engagement, economic agency and in the long-run, mobility. The impacts of financial empowerment on mental health and psychological well-being, while not measured in this study, continue to be an open question. For example, increased banking autonomy and economic agency might reduce worries and uncertainty related to finances, alleviate shame associated with relative poverty and increase life-satisfaction.


On the other hand, poor mental health might affect financial empowerment and inclusion. In an RCT evaluating the long-term impacts of cognitive behavioral therapy (CBT)[1] among women with perinatal depression in Pakistan, the authors find that this therapy has persisting mental health effects even 7 years after treatment, and among women who received CBT depression rates were lower by 5 percentage points than those who did not. Interestingly, they show that women who received CBT and therefore had better mental health, also had significantly higher scores on a financial empowerment index, which included a measure of control over household spending. This paper is indicative of the fact that improving mental health, or treating mental illnesses such as depression and anxiety among women may have bearing on their financial empowerment. More research in this domain may be beneficial in documenting these effects and isolating the mechanisms that drive them. Mental illnesses might impact beliefs about one’s own and others’ abilities. Anxiety might also distort risk assessments and decrease risk-taking. Patience and motivation might also decline due to mental ill-health. All these effects on beliefs, preferences and productivity could plausibly affect labor supply, savings behavior, demand for credit (assuming their availability) and ability to learn and retain information from financial training and education programs.


In summary, women’s financial empowerment and mental health might be linked by a bi-directional causal relationship. Policies and intervention that seek to improve financial empowerment may have positive effects on stress and reduce the incidence of common mental illnesses like depression and anxiety. On the other hand, interventions that improve mental health might lead to increased financial empowerment and reduce financial vulnerabilities. A range of open questions exist when attempting to study this relationship, but greater integration and communication between the two research and policy agendas is likely to yield tremendous insight into the causal impacts of one on the other and the mechanisms that drive them.




Baranov, V., Bhalotra, S., Biroli, P., & Maselko, J. (2020). Maternal depression, women’s empowerment, and parental investment: evidence from a randomized controlled trial. American economic review, 110(3), 824-59.


Barboni, G., Field, E., Pande, R., Rigol, N., Schaner, S., & Moore, C. T. (2018). A Tough Call.


FAO, I. (2008). World Bank.(2009). Gender in agriculture sourcebook. Agriculture and rural development. DOI, 10, 978-0.


Field, E., Pande, R., Rigol, N., Schaner, S., & Troyer Moore, C. (2021). On Her Own Account: How Strengthening Women’s Financial Control Impacts Labor Supply and Gender Norms. American Economic Review, 111(7), 2342-75.


Malhotra, S., & Shah, R. (2015). Women and mental health in India: An overview. Indian journal of psychiatry, 57(Suppl 2), S205.


Ridley, M., Rao, G., Schilbach, F., & Patel, V. (2020). Poverty, depression, and anxiety: Causal evidence and mechanisms. Science, 370(6522).

[1] Cognitive behavioral therapy is a form of psycho-social therapy used to treat mental health conditions such as depression and anxiety. The ‘Thinking Healthy Program’ protocol evaluated in this paper is low-cost, community-based intervention that has recently been adopted by the WHO to be used as a model for other countries.


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About Anahita Karandikar

Anahita Karandikar

Anahita Karandikar is an incoming PhD candidate in Economics at the University of British Columbia. Anahita was previously a Research Associate at the Behavioral Development Lab housed at J-PAL South Asia, where she worked on projects that study questions at the intersection of behavioral and development economics, particularly about mental health and economic well-being in India. Anahita’s research interests are in development and labor economics, gender and social norms. In a range of research collaborations, she is studying the role of internet-based gig work in facilitating female labor force participation and gender gaps in education and their sensitivity to climatic shocks. Anahita is a director at WiEP India Association (Women in Economics and Policy), a non-profit that supports women in building careers in economics, development, policy and allied fields. Anahita holds a bachelor’s degree in Economics from Fergusson College, Pune and a master’s degree in Economics from Ashoka University.

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