Host town identity, but not hometown identity, attenuates the effect of financial stress on paranoia, depression, and anxiety

Debt and financial insecurity are associated with stress, low self-worth and poor health. Joining and identifying with social groups promotes better health and higher self-esteem. In difficult financial times, people’s sense... [ view full abstract ]

Debt and financial insecurity are associated with stress, low self-worth and poor health. Joining and identifying with social groups promotes better health and higher self-esteem. In difficult financial times, people’s sense of identification with their community may protect them from the adverse effects of financial struggle on mental health. Using two existing datasets - a general population survey (Study 1, N=4319) and a student mental health survey (Study 2, N=612) conducted in North West England - we assessed whether community identification moderated the indirect effect of financial stress on mental health (Depression, Anxiety and Paranoia) through self-esteem. Study 1 demonstrated that stronger identification with one’s local neighbourhood attenuated the adverse effects of financial stress on self-esteem and subsequent mental health. Study 2 illustrated that strong host town identities buffered students from mental health symptoms related to financial stress; strong hometown identities showed no protective value, and the effects of financial stress were most severe when hometown identity was strong and host town identity was weak. The findings suggest that one way financial stress impacts on mental health is by eroding self-esteem. Identifying with one’s current place of residence appears to disrupt this pathway, whilst strong hometown identification may exacerbate symptoms when combined with low host town identification. Implications for policy development and models of mental health are discussed.