Post-Traumatic Stress Disorder and the Earnings of Military Reservists

By David S. Loughran; Paul Heaton | Go to book overview

CHAPTER SIX
Longer-Run Effects on Earnings of Being Symptomatic of PTSD

Our discussion so far has focused on the effects of being symptomatic of PTSD on earnings in the year immediately following deployment. Although these effects appear relatively modest, it is possible that labor market effects of being symptomatic of PTSD are not fully manifest until many years following the traumatic experience. For some subset of the reservist population, PTSD symptoms may worsen over time, leading to greater impairment and potentially larger earnings effects. Moreover, small disruptions to labor market activity immediately following deployment may become magnified over time if experience or skills acquired in prior periods affect opportunities for skill development in future periods. However, it is possible that for other reservists, the symptoms of PTSD may diminish with time, lessening the impact of the condition on labor market performance.

Our earnings data extend through 2007, so for reservists ending a period of deployment between 2003 and 2005, we can observe multiple years of post-deployment earnings. For example, for those ending deployment in 2003, we observe earnings for the next four years (2004 through 2007). Following the approach of Chapter Five, we estimate the effect of being symptomatic of PTSD at the end of deployment on earnings in these later years to assess whether the impacts of this condition grow or attenuate over time. The top panel of Table 6.1 shows OLS-FD estimates of the effect of being symptomatic of PTSD on earnings one, two, three, and four years following deployment.1 We present these estimates separately by deployment end date so that within a particular cohort, the sample does not change with years since deployment.

The first entry in Table 6.1 replicates the finding reported in Table 5.2, column 4, of a –$438 effect on annual earnings of being symptomatic of PTSD, using the full sample. Other entries in the first row of Table 6.1 are of similar magnitude, indicating that focusing on particular subsets of the sample based on timing of deployment does not appreciably alter this estimate. However, effects in year 2 are appreciably greater than the year 1 effects, ranging across samples from –$1,235 to –$2,150. For those ending deployment in 2003, the negative effect of being symptomatic of PTSD increases from –$655 in year 1 to –$2,443 (roughly 6 percent of earnings) in year 4. Thus, the pattern in Table 6.1 clearly indicates that the negative effect of being symptomatic of PTSD increases with time since deployment.

To further illuminate the source of these earnings patterns, the bottom panels of Table 6.1 decompose total earnings effects into those attributable to civilian earnings and those

1 We also estimated IV versions of these specifications, using deployment location as instruments. Generally, the IV estimates were statistically indistinguishable from the OLS estimates, but confidence intervals for some IV estimates, particularly those involving smaller samples, were wide.

27

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