1Department of Economics, SFB 884 "Political Economy of Reforms" University of Mannheim, Germany. email@example.com.
This study explores the effects of widowhood on mental health by taking into account the anticipation and adaptation to the partner's death. The empirical analysis uses representative panel data from the USA that are linked to administrative death records of the National Death Index. I estimate static and dynamic specifications of the panel probit model in which unobserved heterogeneity is modeled with correlated random effects. I find strong anticipation effects of the partner's death on the probability of depression, implying that the partner's death event cannot be assumed to be exogenous in econometric models. In the absence of any anticipation effects, the partner's death has long-lasting mental health consequences, leading to a significantly slower adaptation to widowhood. The results suggest that both anticipation effects and adaptation effects can be attributed to a caregiver burden and to the cause of death. The findings of this study have important implications for designing adequate social policies for the elderly US population that alleviate the negative consequences of bereavement.