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Immigrant labor and the institutionalization of the U.S.‐born elderly

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  • Kristin F. Butcher
  • Kelsey Moran
  • Tara Watson

Abstract

The U.S. population is aging. We examine whether immigration causally affects the likelihood that the U.S.‐born elderly live in institutional settings. Using a shift‐share instrument to identify exogenous variation in immigration, we find that a 10 percentage point increase in the less‐educated foreign‐born labor force share in a local area reduces institutionalization among the elderly by 1.5 and 3.8 percentage points for those aged 65+ and 80+, a 26%–29% effect relative to the mean. The estimates imply that a typical U.S.‐born individual over age 65 in the year 2000 was 0.5 percentage points (10%) less likely to be living in an institution than would have been the case if immigration had remained at 1980 levels. We show that immigration affects the availability and cost of home services, including those provided by home health aides, gardeners and housekeepers, and other less‐educated workers, reducing the cost of aging in the community.

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  • Kristin F. Butcher & Kelsey Moran & Tara Watson, 2022. "Immigrant labor and the institutionalization of the U.S.‐born elderly," Review of International Economics, Wiley Blackwell, vol. 30(5), pages 1375-1413, November.
    • Handle: RePEc:bla:reviec:v:30:y:2022:i:5:p:1375-1413
    DOI: 10.1111/roie.12607
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    1. Almuhaisen, Abdulmohsen & Amuedo-Dorantes, Catalina & Furtado, Delia, 2024. "Immigration enforcement and the institutionalization of elderly Americans," Journal of Health Economics, Elsevier, vol. 94(C).

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    More about this item

    JEL classification:

    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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