IDEAS home Printed from https://ideas.repec.org/a/eee/jhecon/v84y2022ics0167629622000583.html
   My bibliography  Save this article

Do Public Caregiving Subsidies and Supports affect the Provision of Care and Transfers?

Author

Listed:
  • Costa-Font, Joan
  • Jiménez-Martín, Sergi
  • Vilaplana-Prieto, Cristina

Abstract

We study whether caregiving and intergenerational transfer decisions are sensitive to changes in economic incentives following the inception of a new unconditional and universal system of allowances and supports, after the introduction of the 2006 Promotion of Personal Autonomy and Care for Dependent Persons Act (SAAD in Spanish), and the ensuing effects of its austerity cuts after 2012. We find that whilst the introduction of a caregiving allowance (of a maximum value of €530 in 2011) increased the supply of informal caregiving by 20-22 percentual points (pp), the inception of a companion system of publicly subsidised homecare supports did not modify the supply of care. Consistent with an exchange motive for intergenerational transfers, we estimate an average 17 pp (8.2-8.7pp) increase (decrease) in downstream (upstream) transfers among those receiving caregiving allowances. Our estimates resulting from the reduction in the allowances and supports after the austerity cuts in 2012 are consistent with our main estimates, and suggest stronguer effects among lower-income families.

Suggested Citation

  • Costa-Font, Joan & Jiménez-Martín, Sergi & Vilaplana-Prieto, Cristina, 2022. "Do Public Caregiving Subsidies and Supports affect the Provision of Care and Transfers?," Journal of Health Economics, Elsevier, vol. 84(C).
    • Handle: RePEc:eee:jhecon:v:84:y:2022:i:c:s0167629622000583
    DOI: 10.1016/j.jhealeco.2022.102639
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167629622000583
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jhealeco.2022.102639?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Joshua D. Angrist & Alan B. Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 69-85, Fall.
    2. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-1054, July.
    3. Pieter Bakx & Claudine de Meijer & Frederik Schut & Eddy van Doorslaer, 2015. "Going Formal or Informal, Who Cares? The Influence of Public Long‐Term Care Insurance," Health Economics, John Wiley & Sons, Ltd., vol. 24(6), pages 631-643, June.
    4. Carmichael, F. & Charles, S. & Hulme, C., 2010. "Who will care? Employment participation and willingness to supply informal care," Journal of Health Economics, Elsevier, vol. 29(1), pages 182-190, January.
    5. Kleibergen, Frank & Paap, Richard, 2006. "Generalized reduced rank tests using the singular value decomposition," Journal of Econometrics, Elsevier, vol. 133(1), pages 97-126, July.
    6. Shimizutani, Satoshi & Suzuki, Wataru & Noguchi, Haruko, 2008. "The socialization of at-home elderly care and female labor market participation: Micro-level evidence from Japan," Japan and the World Economy, Elsevier, vol. 20(1), pages 82-96, January.
    7. Hoerger, Thomas J & Picone, Gabriel A & Sloan, Frank A, 1996. "Public Subsidies, Private Provision of Care and Living Arrangements of the Elderly," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 428-440, August.
    8. Shin-Yi Chou & Jin-Tan Liu & Michael Grossman & Ted Joyce, 2010. "Parental Education and Child Health: Evidence from a Natural Experiment in Taiwan," American Economic Journal: Applied Economics, American Economic Association, vol. 2(1), pages 33-61, January.
    9. Cox, Donald & Rank, Mark R, 1992. "Inter-vivos Transfers and Intergenerational Exchange," The Review of Economics and Statistics, MIT Press, vol. 74(2), pages 305-314, May.
    10. Emily Oster, 2019. "Unobservable Selection and Coefficient Stability: Theory and Evidence," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 37(2), pages 187-204, April.
    11. Frank A. Sloan & Harold H. Zhang & Jingshu Wang, 2002. "Upstream Intergenerational Transfers," Southern Economic Journal, John Wiley & Sons, vol. 69(2), pages 363-380, October.
    12. Liliana E. Pezzin & Peter Kemper & James Reschovsky, 1996. "Does Publicly Provided Home Care Substitute for Family Care? Experimental Evidence with Endogenous Living Arrangements," Journal of Human Resources, University of Wisconsin Press, vol. 31(3), pages 650-676.
    13. Charles Yuji Horioka & Emin Gahramanov & Aziz Hayat & Xueli Tang, 2018. "Why Do Children Take Care Of Their Elderly Parents? Are The Japanese Any Different?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(1), pages 113-136, February.
    14. Stefan Hochguertel & Henry Ohlsson, 2009. "Compensatory inter vivos gifts," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(6), pages 993-1023.
    15. Becker, Gary S, 1981. "Altruism in the Family and Selfishness in the Market Place," Economica, London School of Economics and Political Science, vol. 48(189), pages 1-15, February.
    16. Wolff, Francois-Charles & Laferrere, Anne, 2006. "Microeconomic models of family transfers," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 13, pages 889-969, Elsevier.
    17. Joan Costa‐Font & Edward C. Norton & Luigi Siciliani & Joan Costa‐Font & Cristina Vilaplana‐Prieto, 2017. "Does the Expansion of Public Long‐Term Care Funding Affect Saving Behaviour?," Fiscal Studies, Institute for Fiscal Studies, vol. 38, pages 417-443, September.
    18. Johannes Geyer & Thorben Korfhage, 2015. "Long‐term Care Insurance and Carers' Labor Supply – A Structural Model," Health Economics, John Wiley & Sons, Ltd., vol. 24(9), pages 1178-1191, September.
    19. Van Houtven, Courtney Harold & Norton, Edward C., 2004. "Informal care and health care use of older adults," Journal of Health Economics, Elsevier, vol. 23(6), pages 1159-1180, November.
    20. Kathleen McGarry, 2000. "Testing Parental Altruism: Implications of a Dynamic Model," NBER Working Papers 7593, National Bureau of Economic Research, Inc.
    21. Costa-Font, Joan & Jimenez-Martin, Sergi & Vilaplana, Cristina, 2018. "Does long-term care subsidization reduce hospital admissions and utilization?," Journal of Health Economics, Elsevier, vol. 58(C), pages 43-66.
    22. Meghan M. Skira, 2015. "Dynamic Wage And Employment Effects Of Elder Parent Care," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56(1), pages 63-93, February.
    23. Marjolein I. Broese van Groenou & Alice Boer, 2016. "Providing informal care in a changing society," European Journal of Ageing, Springer, vol. 13(3), pages 271-279, September.
    24. Alessandra Fogli & Raquel Fernandez, 2009. "Culture: An Empirical Investigation of Beliefs, Work, and Fertility," American Economic Journal: Macroeconomics, American Economic Association, vol. 1(1), pages 146-177, January.
    25. Oded Stark & Ita Falk, 2000. "Transfers, Empathy Formation, and Reverse Transfers," International Economic Association Series, in: L.-A. Gérard-Varet & S.-C. Kolm & J. Mercier Ythier (ed.), The Economics of Reciprocity, Giving and Altruism, chapter 8, pages 174-181, Palgrave Macmillan.
    26. Stefan Hochguertel & Henry Ohlsson, 2009. "Compensatory inter vivos gifts," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(6), pages 993-1023.
    27. Sloan, Frank A & Picone, Gabriel & Hoerger, Thomas J, 1997. "The Supply of Children's Time to Disabled Elderly Parents," Economic Inquiry, Western Economic Association International, vol. 35(2), pages 295-308, April.
    28. Rainer Winkelmann, 2004. "Co‐payments for prescription drugs and the demand for doctor visits – Evidence from a natural experiment," Health Economics, John Wiley & Sons, Ltd., vol. 13(11), pages 1081-1089, November.
    29. Altonji, Joseph G & Hayashi, Fumio & Kotlikoff, Laurence J, 1997. "Parental Altruism and Inter Vivos Transfers: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 105(6), pages 1121-1166, December.
    30. Herwartz, Helmut & Theilen, Bernd, 2017. "Ideology and redistribution through public spending," European Journal of Political Economy, Elsevier, vol. 46(C), pages 74-90.
    31. Sanna Nivakoski, 2019. "Does the exchange motive influence intergenerational transfers? Evidence from Ireland," Review of Economics of the Household, Springer, vol. 17(3), pages 1049-1079, September.
    32. repec:mpr:mprres:5583 is not listed on IDEAS
    33. Cox, Donald, 1987. "Motives for Private Income Transfers," Journal of Political Economy, University of Chicago Press, vol. 95(3), pages 508-546, June.
    34. Bremer, Patrick & Challis, David & Hallberg, Ingalill Rahm & Leino-Kilpi, Helena & Saks, Kai & Vellas, Bruno & Zwakhalen, Sandra M.G. & Sauerland, Dirk, 2017. "Informal and formal care: Substitutes or complements in care for people with dementia? Empirical evidence for 8 European countries," Health Policy, Elsevier, vol. 121(6), pages 613-622.
    35. Callaway, Brantly & Sant’Anna, Pedro H.C., 2021. "Difference-in-Differences with multiple time periods," Journal of Econometrics, Elsevier, vol. 225(2), pages 200-230.
    36. Michelle Marcus & Pedro H. C. Sant’Anna, 2021. "The Role of Parallel Trends in Event Study Settings: An Application to Environmental Economics," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 8(2), pages 235-275.
    37. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 249-275.
    38. Becketti, Sean & Gould, William & Lillard, Lee & Welch, Finis, 1988. "The Panel Study of Income Dynamics after Fourteen Years: An Evaluatio n," Journal of Labor Economics, University of Chicago Press, vol. 6(4), pages 472-492, October.
    39. Kim, Hyuncheol Bryant & Lim, Wilfredo, 2015. "Long-term care insurance, informal care, and medical expenditures," Journal of Public Economics, Elsevier, vol. 125(C), pages 128-142.
    40. Fu, Rong & Noguchi, Haruko & Kawamura, Akira & Takahashi, Hideto & Tamiya, Nanako, 2017. "Spillover effect of Japanese long-term care insurance as an employment promotion policy for family caregivers," Journal of Health Economics, Elsevier, vol. 56(C), pages 103-112.
    41. Rob Alessie & Viola Angelini & Giacomo Pasini, 2014. "Is It True Love? Altruism Versus Exchange in Time and Money Transfers," De Economist, Springer, vol. 162(2), pages 193-213, June.
    42. Sarah Karlsberg Schaffer, 2015. "The Effect of Free Personal Care for the Elderly on Informal Caregiving," Health Economics, John Wiley & Sons, Ltd., vol. 24(S1), pages 104-117, March.
    43. Ernesto Villanueva, 2005. "Inter vivos transfers and bequests in three OECD countries [‘Precautionary savings and accidental bequests’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 20(43), pages 506-565.
    44. José G. Montalvo, 2011. "Voting after the Bombings: A Natural Experiment on the Effect of Terrorist Attacks on Democratic Elections," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1146-1154, November.
    45. Meghan M. Skira, 2015. "Dynamic Wage And Employment Effects Of Elder Parent Care," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56, pages 63-93, February.
    46. Costa-Font, Joan & Vilaplana-Prieto, Cristina, 2023. "Caregiving subsidies and spousal early retirement intentions," Journal of Pension Economics and Finance, Cambridge University Press, vol. 22(4), pages 550-589, October.
    47. Hans van Kippersluis & Cornelius A. Rietveld, 2018. "Beyond plausibly exogenous," Econometrics Journal, Royal Economic Society, vol. 21(3), pages 316-331, October.
    48. Spieß, Christa Katharina & Schneider, A. Ulrike, 2003. "Interactions between care-giving and paid work hours among European midlife women, 1994 to 1996," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 23(01), pages 41-68.
    49. Goodman-Bacon, Andrew, 2021. "Difference-in-differences with variation in treatment timing," Journal of Econometrics, Elsevier, vol. 225(2), pages 254-277.
    50. Kathleen McGarry & Robert F. Schoeni, 1995. "Transfer Behavior in the Health and Retirement Study: Measurement and the Redistribution of Resources within the Family," Journal of Human Resources, University of Wisconsin Press, vol. 30, pages 184-226.
    51. Stabile, Mark & Laporte, Audrey & Coyte, Peter C., 2006. "Household responses to public home care programs," Journal of Health Economics, Elsevier, vol. 25(4), pages 674-701, July.
    52. McGarry, Kathleen, 1999. "Inter vivos transfers and intended bequests," Journal of Public Economics, Elsevier, vol. 73(3), pages 321-351, September.
    53. A. Colin Cameron & Pravin K. Trivedi, 2010. "Microeconometrics Using Stata, Revised Edition," Stata Press books, StataCorp LP, number musr, March.
    54. Sun, Liyang & Abraham, Sarah, 2021. "Estimating dynamic treatment effects in event studies with heterogeneous treatment effects," Journal of Econometrics, Elsevier, vol. 225(2), pages 175-199.
    55. Carmichael, Fiona & Charles, Susan, 2003. "The opportunity costs of informal care: does gender matter?," Journal of Health Economics, Elsevier, vol. 22(5), pages 781-803, September.
    56. repec:fth:prinin:455 is not listed on IDEAS
    57. Frank A. Sloan & Jingshu Wang & Harold H. Zhang, 2002. "Upstream Intergenerational Transfers," Southern Economic Journal, John Wiley & Sons, vol. 69(2), pages 363-380, October.
    58. Ryotaro Fukahori & Tadashi Sakai & Kazuma Sato, 2015. "The Effects of Incidence of Care Needs in Households on Employment, Subjective Health, and Life Satisfaction among Middle-aged Family Members," Scottish Journal of Political Economy, Scottish Economic Society, vol. 62(5), pages 518-545, November.
    59. Joshua Angrist & Alan Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Working Papers 834, Princeton University, Department of Economics, Industrial Relations Section..
    60. Anirban Basu & Norma Coe & Cole G. Chapman, 2017. "Comparing 2SLS vs 2SRI for Binary Outcomes and Binary Exposures," NBER Working Papers 23840, National Bureau of Economic Research, Inc.
    61. Norton Edward C. & Nicholas Lauren H. & Huang Sean Sheng-Hsiu, 2013. "Informal Care and Inter-vivos Transfers: Results from the National Longitudinal Survey of Mature Women," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(2), pages 377-400, May.
    62. repec:oup:ecpoli:v:20:y:2005:i:43:p:505-565 is not listed on IDEAS
    63. Edward C. Norton & Courtney Harold Van Houtven, 2006. "Inter‐vivos Transfers and Exchange," Southern Economic Journal, John Wiley & Sons, vol. 73(1), pages 157-172, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Joan Costa-Font & Sergi Jimenez-Martin & Cristina Vilaplana-Prieto & Analía Viola, 2023. "Universalizing the Access to Long-term Care: Evidence from Spain," NBER Working Papers 31825, National Bureau of Economic Research, Inc.
    2. Renner, Anna-Theresa & Shaikh, Mujaheed & Spitzer, Sonja, 2023. "The long-term impact of maternal leave duration on smoking behavior," MPRA Paper 118675, University Library of Munich, Germany.
    3. Rapp, Thomas & Jena, Anupam B. & Costa-Font, Joan & Grabowski, David C., 2023. "Caregiving across generations: Do older adults with more grandchildren get another bite at the “sandwich” generation?," Social Science & Medicine, Elsevier, vol. 334(C).
    4. Joan Costa-Font & Sergi Jiménez & Cristina Vilaplana Prieto & Analía Viola, 2022. "Long-term Care in Spain," Studies on the Spanish Economy eee2022-23, FEDEA.
    5. Joan Costa-Font, 2023. "How to support adult caregivers?," IZA World of Labor, Institute of Labor Economics (IZA), pages 510-510, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Joan Costa-Font & Sergi Jiménez-Martín & Cristina Vilaplana-Prieto, 2016. "Thinking of Incentivizing Care? The Effect of Demand Subsidies on Informal Caregiving and Intergenerational Transfers," Working Papers 2016-08, FEDEA.
    2. Costa-Font, Joan & Vilaplana-Prieto, Cristina, 2022. "Mental health effects of caregivers respite: Subsidies or Supports?," The Journal of the Economics of Ageing, Elsevier, vol. 23(C).
    3. Sergi Jiménez-Martín & Cristina Vilaplana Prieto, 2013. "Informal Care and intergenerational transfers in European Countries," Working Papers 2013-25, FEDEA.
    4. Rob Alessie & Viola Angelini & Giacomo Pasini, 2014. "Is It True Love? Altruism Versus Exchange in Time and Money Transfers," De Economist, Springer, vol. 162(2), pages 193-213, June.
    5. Edwin S. Wong, 2013. "Gender preference and transfers from parents to children: an inter-regional comparison," International Review of Applied Economics, Taylor & Francis Journals, vol. 27(1), pages 61-80, January.
    6. Wolff, Francois-Charles & Laferrere, Anne, 2006. "Microeconomic models of family transfers," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 13, pages 889-969, Elsevier.
    7. Max Groneck, 2017. "Bequests and Informal Long-Term Care: Evidence from HRS Exit Interviews," Journal of Human Resources, University of Wisconsin Press, vol. 52(2), pages 531-572.
    8. Emanuele Ciani & Claudio Deiana, 2018. "No free lunch, buddy: past housing transfers and informal care later in life," Review of Economics of the Household, Springer, vol. 16(4), pages 971-1001, December.
    9. Francois-Charles Wolff & Seymour Spilerman & Claudine Attias-Donfut, 2005. "Do Parents Help More their Less Well-Off Children? Evidence from a Sample of Migrants to France," Microeconomics 0504001, University Library of Munich, Germany.
    10. Kristopher Gerardi & Yuping Tsai, 2014. "The Effect of Social Entitlement Programmes on Private Transfers: New Evidence of Crowding Out," Economica, London School of Economics and Political Science, vol. 81(324), pages 721-746, October.
    11. Arrondel, Luc & Masson, Andre, 2006. "Altruism, exchange or indirect reciprocity: what do the data on family transfers show?," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 14, pages 971-1053, Elsevier.
    12. Max Groneck & Frederic Krehl, 2014. "Bequests and Informal Long-Term Care: Evidence from the HRS Exit Interviews," Working Paper Series in Economics 79, University of Cologne, Department of Economics.
    13. Sanna Nivakoski, 2019. "Does the exchange motive influence intergenerational transfers? Evidence from Ireland," Review of Economics of the Household, Springer, vol. 17(3), pages 1049-1079, September.
    14. Bonsang, Eric & Costa-Font, Joan, 2023. "The "Demise of the Caregiving Daughter"? Gender Employment Gaps and the Use of Formal and Informal Care in Europe," IZA Discussion Papers 16615, Institute of Labor Economics (IZA).
    15. Sergi Jiménez‐Martín & Cristina Vilaplana Prieto, 2015. "Informal Care Motivations and Intergenerational Transfers in European Countries," Health Economics, John Wiley & Sons, Ltd., vol. 24(S1), pages 89-103, March.
    16. Cristina Vilaplana Prieto & Sergi Jiménez-Martín, 2015. "Unmet needs in formal care: kindling the spark for caregiving behavior," International Journal of Health Economics and Management, Springer, vol. 15(2), pages 153-184, June.
    17. Nikolov, Plamen & Adelman, Alan, 2019. "Do private household transfers to the elderly respond to public pension benefits? Evidence from rural China," The Journal of the Economics of Ageing, Elsevier, vol. 14(C).
    18. Olivera, Javier, 2017. "The division of inter-vivos parental transfers in Europe," The Journal of the Economics of Ageing, Elsevier, vol. 9(C), pages 41-51.
    19. Audrey Light & Kathleen McGarry, 2004. "Why Parents Play Favorites: Explanations for Unequal Bequests," American Economic Review, American Economic Association, vol. 94(5), pages 1669-1681, December.
    20. Ha Trong Nguyen & Luke B. Connelly, 2017. "The Dynamics of Informal Care Provision in an Australian Household Panel Survey: Previous Work Characteristics and Future Care Provision," The Economic Record, The Economic Society of Australia, vol. 93(302), pages 395-419, September.

    More about this item

    Keywords

    Caregiving; Intergenerational transfers; Unconditional transfer; Long-term care; Family transfers; exchange motivation; Allowances; Spain; Exchange motives;
    All these keywords.

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G22 - Financial Economics - - Financial Institutions and Services - - - Insurance; Insurance Companies; Actuarial Studies

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jhecon:v:84:y:2022:i:c:s0167629622000583. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505560 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.