Useful beautiful minds-an analysis of the relationship between schizophrenia and employment

This paper examines the relationship between schizophrenia and employment. We use longitudinal register data and show a considerable drop in the employment rate for people with schizophrenia six years before the first treatment at a psychiatric facility. After the first treatment, the employment rate stabilizes at 18%. The difference in the employment rate in 2007 for siblings with and without schizophrenia is estimated at 67%. This difference is reduced to 62% when we include additional control variables. The results remain unchanged when we apply a sibling fixed effects approach that controls for the unobserved family specific characteristics that the siblings share.