From drought to distress: unpacking the mental health effects of water scarcity

I provide quasi-experimental evidence of the effect of drought exposure on young adults’ experiences of anxiety and depression by leveraging a natural experiment: the 2021 drought in Ethiopia. My analysis applies a difference-in-differences strategy and couples 40 years of rainfall data with longitudinal data on mental health. I find that exposure to below long-run average rainfall increases in the probability of experiencing at least mild anxiety and depression by 0.35 and 0.29 standard deviations, respectively. These effects are strongest among those who grew up in the poorest households and those with low childhood reading ability. The impact on depression is also pronounced among those with low self-esteem. Additional evidence on mechanisms suggests the mental health effects may partly be explained by the drought’s impact on food insecurity, inflation, and perceived household poverty.