4 Ways Capitalism Harms Mental Health and What to Do About It

"It is no measure of health to be well adjusted to a profoundly sick society." – J. Krishnamurti

Capitalism has brought about several positive outcomes. It’s associated with high levels of economic growth, which has led to improved living standards and increased prosperity in many parts of the world.

However, research shows that increasing levels of prosperity no longer enhance our quality of life. We’ve reached a turning point in history, and we need to ask ourselves whether the pursuit of unbridled economic growth at all costs is the best path forward.

Our market-driven economy prioritising productivity and profit may be harming our mental health and wellbeing in numerous ways. In this article, we’ll outline four issues to consider, along with what you can do about it.

1. Economic Inequality

Arguably one of the most striking ways capitalism affects mental health is through economic inequality.

Anthropological and archaeological research indicates that equality used to be the norm in early human societies. For example, ethnographic records often point to a greater emphasis on communal living and resource sharing among our ancestors.

Fast forward to the early 1900s, and high tax rates and a shared ideology among the corporate sector, civil society, and the government also emphasised the importance of controlling inequality.

This all came to an end in the 1980s. The Reagan-Thatcher era led to more conservative economic policies that favoured deregulation and lower taxes. Since then, we’ve seen a significant increase in inequality in the UK, US and various other advanced economies.

Here’s how far we’ve let it go: in 2022, the world’s richest 1% owned 44% of all the world’s wealth.

The consequences of inequality are described thoroughly in the book The Spirit Level by Richard Wilkinson and Kate Pickett.

The book cites a vast array of research showing that almost every modern social and environmental problem (i.e., mental health issues, ill-health, lack of community life, violence, drugs, obesity, long working hours, big prison populations) is more likely to occur in a less equal society.

Have you ever viewed social anxiety through a capitalist lens?

In their subsequent book The Inner Level, Wilkinson and Pickett describe a large body of research supporting the idea that more unequal societies have higher levels of what psychologists call "socio-evaluative threat" – anxiety that arises due to the fear of negative judgement from others.

It’s also known as "status anxiety".

In other words, social anxiety may arise due to one’s perceived position in a social group. Besides triggering anxiety, socio-evaluative threat may harm mental wellbeing by triggering feelings of shame, insecurity and low mood.

The Struggle to Meet Our Basic Needs

The wealth gap places enormous stress on those struggling to make ends meet. The constant pressure to secure basic necessities like housing, healthcare, and education contributes to anxiety and depression, particularly for those on the lower end of the economic spectrum.

Due to the cost-of-living crisis, many people are being forced to work longer hours and take on additional jobs simply to keep pace with skyrocketing expenses.

Organisations researching inequality such as The Equality Trust and The World Inequality Lab argue that policy reforms such as progressive wealth taxation and financial sector reforms are urgently needed to decrease economic inequality.

2. Detrimental Value Systems

"Materialism is a general social affliction visited upon us by government policy, corporate strategy, the collapse of communities and civic life, and our acquiescence in a system that is eating us from the inside out." – George Monbiot

There’s strong evidence to suggest that the predominant value promoted in capitalist societies, materialism, directly harms wellbeing.

Materialism can be defined as: prioritising the importance of material possessions and wealth as a central focus of life and wellbeing.

Extensive research supports the idea that materialism is associated with anxiety and depression. For example, a series of studies spanning 12 years by Tim Kasser and colleagues found that as people become more materialistic, their wellbeing declines. As they become less materialistic, it rises.

A review of over 250 studies looking at the relationship between wellbeing and having a materialistic orientation found a clear negative association between various types of wellbeing and people's prioritisation of materialist pursuits in life.

The Pressure of Individualism

The value of individualism is also highly emphasised in capitalist societies. The pressure to take complete control of one's life and destiny often leads to a relentless burden that can damage mental health. Two factors underpinning this are:

1. Unrealistic Expectations

Extreme individual responsibility places unrealistic expectations on people to be solely responsible for their success, financial stability, and wellbeing.

This can create an overwhelming sense of pressure, especially when external factors, such as economic conditions or systemic inequalities, are beyond a person’s control.

When people fall short of these lofty expectations, they may feel like they’ve failed, which can lead to feelings of anxiety, inadequacy, and low mood.

Economist Thomas Piketty's concept of "meritocratic extremism" refers to how extremely wealthy people often attribute their privilege to hard work and education, overlooking the role of luck, family background, and social structures in shaping one's opportunities.

For example, research indicates that societies with greater income and wealth inequality tend to have lower levels of social mobility. In other words, it's harder for individuals to move up or down the economic ladder in more unequal societies.

2. Social Isolation

In a hyper-individualistic society, there's a tendency for community bonds to weaken. As individuals prioritise their own needs and ambitions, the sense of shared responsibility and interdependence in communities diminishes.

Studies have shown that friendship in the US has been in decline. Three decades ago, 3% of Americans told Gallup pollsters that they had no close friends. In 2021, it quadrupled to 12%.

The growing dissatisfaction with the isolation of modern life may have led to the recent surge of interest in intentional communities. The Foundation for Intentional Community website states:

“FIC defines an intentional community as a group of people who have chosen to live together or share resources on the basis of common values. You may have heard of a commune, ecovillage, co-housing, co-living or student co-op. These are all types of intentional communities. Intentional communities model more cooperative, sustainable and just ways of life.”

In modern intentional communities, the emphasis is on co-housing, where community members have their own private living spaces while actively participating in the management, maintenance, and shared resources of the entire community.

According to the FIC, a survey involving 200 co-housing residents revealed that they saved $200 on their monthly overall expenses. In certain cases, savings exceeded $2,000 per month.

3. The Rise of Processed Foods

Under capitalism, the primary goal of many businesses is to maximize profits. In the food industry, this has led to the prioritisation of cost-effective and highly processed foods.

In diets high in processed foods, the balance of beneficial bacteria in the gut can be disrupted. This imbalance can have far-reaching consequences, leading to digestive problems, inflammation, and a compromised gut lining.

Beyond the digestive realm, it potentially plays a role in various health issues, including compromised mental health, obesity, and metabolic disorders.

Processed foods also contribute to fluctuations in blood sugar levels. These fluctuations can affect mood and energy levels on a daily basis, potentially contributing to symptoms of irritability, fatigue, and mood swings. In the long term, such dietary patterns are linked to depression and anxiety.

In addition, processed foods are intentionally formulated to be hyper-palatable. These properties can lead to overconsumption and addiction-like behaviours, contributing to a cycle of overeating, guilt, negative self-perception, and an unhealthy relationship with food.

4. Lack of Access to Therapy

Access to therapy is a pressing concern. Four factors that may contribute to this issue are:

1. High Entry Costs for Therapists

Becoming a licensed therapist typically requires extensive education followed by supervised training and licensure. In a capitalist system, education is often market-driven, meaning that educational institutions operate as businesses. Therefore, the costs of obtaining therapist qualifications, including tuition, supervision fees, and licensing exams, can be prohibitively high.

This high entry barrier discourages many potential therapists from pursuing the profession, limiting the pool of mental health providers.

2. Overworked Therapists

The profit motive in capitalist systems translate to a constant push for higher productivity and increased revenue. In therapy settings, this manifests as therapists being expected to see a high number of clients in a day, week, or month, often beyond what’s sustainable or conducive to effective care.

This relentless drive for profit often leads to therapists being overworked. According to the APA, 45% of psychologists reported feeling burned out in 2022.

Many therapists who experience burnout may ultimately choose to leave the profession altogether.

3. Expensive Individual Therapy

For people seeking therapy, the costs can also be a substantial burden.

Private therapy sessions are often expensive, making them unaffordable for many. In a capitalist system where healthcare is often privatized, therapy is viewed as a commodity, with prices set according to demand.

4. Insurance Coverage Disparities

The ability to access mental healthcare is also frequently tied to insurance coverage.

Those with comprehensive insurance plans may have better access to therapy, while others may have limited or no coverage for mental health services. This creates a two-tiered system in which access to mental health support is stratified by economic means.

What Can We Do?

Here are three actionable strategies to consider.

1. Examine Your Values

Have you ever spent time reflecting on what your authentic values are, and how much your behaviour aligns with them?

Here are some contrasting values along with what they look/sound like:

Capitalist Values

Alternative Values

  • Materialism: Always buying new things
  • Wealth: "I want to be rich"
  • Independence: "I must do everything myself"
  • Ambition: Working long hours, "hustle" mindset
  • Productivity: "I must always be productive"
  • Sustainability: Re-using, fixing, buying second hand, DIY
  • Frugality/Minimalism: "I don't need a lot of money/possessions to feel content"
  • Interdependence: "It's okay to seek help and rely on others"
  • Balance: Prioritising work-life balance
  • Rest: "Rest is vital for my mental and physical wellbeing"

Want to clarify your values?

Download our free Value Worksheets using the form below.

Assess Your Information Diet

Similarly, how much does the information you consume promote values that are detrimental to wellbeing? Does your social media convey the message that materialism and wealth are the keys to happiness? If so, it might be worth altering your information diet so that it better nurtures your mental health.

2. Civic Engagement

Being an active participant in your community can be a powerful way to address the systemic issues affecting mental health.

Engage in grassroots movements, support policies that prioritise economic equality and access to mental healthcare, and raise your voice to help influence change. By advocating for systemic reforms, you can contribute to a fairer society.

Here are some ideas:

  • Self-education. Learn about political processes and social issues to become a more informed and engaged citizen with books such as The Spirit Level.
  • Support campaigning organisations. Find local or national organisations that align with your values and support them. For example, Inequality.org and Citizens for Tax Justice in the US, and The Equality Trust in the UK.
  • Write to your elected representatives. In the UK, you can find them through this website. For the US, you can find them through this website (in the search bar in the top right hand corner). State your concerns and the specific issue you'd like to address, and consider providing evidence or supporting information. Here's a template for a message you could send.
  • Use social media to raise awareness. Spread the word about pressing societal issues online. Share resources like this article or ones from the organisations mentioned above.
  • Local activism and volunteering. For example, The Equality Trust works with local groups across the world, carrying out awareness-raising and campaigning work to reduce inequality. Find your closest local group here.

3. Nurture Your Mental Health

In page 53 of our free eBook The Framework, we note how calming down your body may be the best intervention for managing economic-induced stress and anxiety.  

The book explains how prolonged stress can result in what we call autostress. In the state of autostress, your sympathetic nervous system (SNS) goes into overdrive. To counteract this, you need to increase the activity of your parasympathetic nervous system (PNS). Download our book for free by filling out the form below: 


"A large and growing body of evidence has suggested that when society reaches current levels of prosperity, it no longer increases our quality of life. Given that throughout human history, more has always meant better, this marks a fundamental turning point in human development." – Richard Wilkinson and Kate Pickett, The Inner Level

While capitalism has undoubtedly brought about many positive outcomes, increasing levels of prosperity no longer enhance our quality of life.

As we confront the challenges of our time, we must strike a balance between the benefits of capitalism and the need for a more equitable and sustainable approach to economic progress.

The relationship between capitalism, economic inequality, and health outcomes is complex and multifaceted, but this should not detract us from acknowledging possible systemic influences on mental health and wellbeing.

Economic inequality, detrimental value systems, the rise of processed food, and lack of access to therapy may be contributing to a collective mental health and wellbeing burden. Actions we can take to address this include examining our values, civic engagement, and nurturing our mental health.

For mental health professionals, viewing people and their issues through a systemic lens is a vital step towards addressing the mental health challenges that so many people face. By recognising the interconnected nature of societal, economic, and mental health issues, we can work towards a more compassionate society that prioritises the mental health and wellbeing of all its members.


About Rebecca

Rebecca is the founder of The Wellness Society and author of two fluff-free books, The Framework and Understanding and Healing Trauma.

She's passionate about creating concise and compassionate mental health and wellbeing tools that address the root causes of distress.

Read more about her views on our About page.