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Inequality and psychological well-being in times of COVID-19: evidence from Spain

Author

Listed:
  • Monica Martinez-Bravo

    (CEMFI)

  • Carlos Sanz

    (Banco de España)

Abstract

Using two novel online surveys collected in May and November 2020, we study the consequences of the first stages of the COVID-19 pandemic on Spanish households. We document a large and negative effect on household income. By May 2020 the average individual lived in a household that had lost 16% of their pre-pandemic monthly income. Furthermore, this drop was highly unequal: while households in the richest quintile lost 6.8% of their income, those in the poorest quintile lost 27%. We also document that the pandemic deepened the gender-income gap: on average, women experienced a three-percentage-point larger income loss than men. While this is consistent with previous findings in the literature, in this paper we document that this effect is driven by women from middle-income households with kids. Finally, we provide evidence that Spanish individuals experienced moderate declines in their levels of psychological well-being. This effect is not different for individuals living in rich or poor households, but the reasons behind well-being losses do differ: richer individuals are more concerned about loss of contact with dear ones, while low-income individuals are more likely to mention loss of income and employment as a key source of emotional distress.

Suggested Citation

  • Monica Martinez-Bravo & Carlos Sanz, 2022. "Inequality and psychological well-being in times of COVID-19: evidence from Spain," Working Papers 2204, Banco de España.
    • Handle: RePEc:bde:wpaper:2204
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    References listed on IDEAS

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    Cited by:

    1. Alfonsi, Livia & Namubiru, Mary & Spaziani, Sara, 2022. "Gender Gaps: Back and Here to Stay? Evidence from Skilled Ugandan Workers during COVID-19," Institute for Research on Labor and Employment, Working Paper Series qt44s4b2dk, Institute of Industrial Relations, UC Berkeley.
    2. Foremny, Dirk & Sorribas-Navarro, Pilar & Vall Castelló, Judit, 2024. "Income insecurity and mental health in pandemic times," Economics & Human Biology, Elsevier, vol. 53(C).
    3. Livia Alfonsi & Mary Namubiru & Sara Spaziani, 2024. "Gender gaps: back and here to stay? Evidence from skilled Ugandan workers during COVID-19," Review of Economics of the Household, Springer, vol. 22(3), pages 999-1046, September.
    4. Stefanie Stantcheva, 2022. "Inequalities in the times of a pandemic," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 37(109), pages 5-41.
    5. Monica Martinez-Bravo & Carlos Sanz, 2022. "The Management of the Pandemic and its Effects on Trust and Accountability," Working Papers wp2022_2207, CEMFI.
    6. Lafuente, Cristina & Ruland, Astrid & Santaeulàlia-Llopis, Raül & Visschers, Ludo, 2023. "The effects of Covid-19 on couples’ job tenures: Mothers have it worse," Labour Economics, Elsevier, vol. 83(C).

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    More about this item

    Keywords

    inequality; COVID-19; well-being;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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