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The Financial Support for Long-Term Elderly Care and Household Savings Behaviour

Listed author(s):
  • Asako OHINATA

    ()

    (University of Leicester, UK, Department of Economics)

  • Matteo PICCHIO

    ()

    (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)

We analyse how the financial support for long-term elderly care affects the level of household savings. Using a difference-in-differences estimator, we investigate the 2002 Scottish reform, which introduced free formal personal care for all the elderly aged 65 and above residing in Scotland. Our semiparametric estimation technique allows the policy effects to be flexibly estimated across age groups. We find that the Scottish policy reduced the average household saving by about £7,200. Moreover, the estimated effects are heterogeneous across age groups of the head of household: these effects are particularly strong among those aged between 40 and 60. The largest effect is observed at age 49 with the reduction in the average household saving by £12,764.
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File URL: http://docs.dises.univpm.it/web/quaderni/pdf/411.pdf
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Paper provided by Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali in its series Working Papers with number 411.

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Length: 45
Date of creation: Sep 2015
Handle: RePEc:anc:wpaper:411
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