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The 1997 Indonesian financial crisis resulted in severe economic dislocation and political upheaval, and the detrimental consequences for economic welfare, physical health, and child education have been established in several studies. The crisis also adversely impacted the psychological well-being of the Indonesian population. Comparing responses of the same individuals interviewed before and after the crisis, we document substantial increases in several different dimensions of psychological distress among male and female adults across the entire age distribution. In addition, the imprint of the crisis can be seen in the differential impacts of the crisis on low education groups, the rural landless, and residents in those provinces that were most affected by the crisis. Elevated levels of psychological distress persist even after indicators of economic well-being such as household consumption had returned to pre-crisis levels, suggesting the deleterious effects of the crisis on the psychological well-being of the Indonesian population may be longer lasting than the impacts on economic well-being.

Psychological Health Before, During, and After an Economic Crisis: Results from Indonesia, 1993–2000