Global Economic Uncertainty and Suicide Risk
Economic uncertainty has been increasing since the 2008 global financial crisis and the European debt crisis. It was highest in 2016 and 2021 during the Covid-19 pandemic, but declined as the virus became endemic in many regions. More recently, it has risen again following Russia’s invasion of Ukraine.
One reason for the increase is that uncertainty is a deterrent to foreign investment. Investors might postpone decisions to wait and see whether the situation improves or worsens. However, it is costly to reverse such a decision. FDI into developing countries may be lower as uncertainty increases.
Researchers have noted that global economic uncertainty has increased in the past several years, especially in advanced economies such as the United States and the United Kingdom. While other advanced economies have a smaller impact on global uncertainty, the United States is the largest economy in the world and the largest source of uncertainty. The chart below shows how the average amount of uncertainty arising from the U.S. compared to the world average.
The study also showed that a large increase in economic uncertainty was associated with a higher risk of suicide. In the Middle East, North Africa, and sub-Saharan Africa, a one-unit increase in GEPU led to a 0.034 increase in the average suicide rate.
The study also indicated that African economies were particularly vulnerable to global shocks and were significantly affected by global economic uncertainty. In Africa, the adverse effects of global economic pandemic uncertainty were compounded by weak economic governance institutions. Therefore, the study concluded that global economic uncertainty may be a significant barrier to FDI inflow.
The COVID-19 pandemic, the recent decline in international oil prices, the Brexit vote, and the US-China trade war all heightened the global uncertainty. These factors may help explain the differences between Europe and Central Asia in suicide rates. Welfare policies and government aid programs may also help mitigate the initial impact of economic uncertainty shocks.
The relationship between economic uncertainty and the risk of suicide has been documented in a study examining 183 countries. The effects of global economic uncertainty were greatest in Africa and the Middle East. In addition, economic growth and unemployment rates were found to influence suicide rates. The study also found that lagged economic uncertainty was correlated with increased risk of suicide.
