Do Health Shocks Modify Personality Traits? Evidence from Locus Of Control

This paper analyzes whether a personality trait, that is, locus of control, is stable after the occurrence of a health shock, namely a hospital stay. To do so, we use the German Socio-Economics Panel dataset. To identify the causal effect of such a shock on locus of control, we rely on a fixed-effects model. Results suggest that individuals facing health shocks are more likely to decrease their locus of control. That is, they tend to believe that their future outcomes are more determined by external factors than their own will. This decrease is attributable to individuals that had, prior to the shock, lower values of locus of control. Further, individuals facing severe hospital stays (i.e., measured by the number overnights) and those with chronic diseases (i.e., measured by the number of hospital stays within a year), have a higher LOC decline than others. This provides evidence that perception of control is not constant over time and could change after experiencing a traumatic health event