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Labour Supply and Informal Care Supply: The Impacts of Financial Support for Long-Term Elderly Care

Author

Listed:
  • Bruce Hollingsworth

    () (Lancaster University, United Kingdom)

  • Asako Ohinata

    () (Department of Economics, University of Leicester, United Kingdom; CentER, Tilburg University, The Netherlands.)

  • Matteo Picchio

    () (Department of Economics and Social Sciences, Marche Polytechnic University, Ancona, Italy; Sherppa, Ghent University, Belgium; IZA, Germany.)

  • Ian Walker

    () (Management School, Lancaster University, United Kingdom; IZA, Germany.)

Abstract

We investigate the impact of a policy reform, which introduced free formal personal care for all those aged 65 and above, on caregiving behaviour. Using a difference-indifferences estimator, we estimate that the free formal care reduced the probability of co-residential informal caregiving by 12.9%. Conditional on giving co-residential care, the mean reduction in the number of informal care hours is estimated to be 1:2 hours per week. The effect is particularly strong among older and less educated caregivers. In contrast to co-residential informal care, we find no change in extra-residential caregiving behaviour. We also observe that the average labour market participation and the number of hours worked increased in response to the policy introduction.

Suggested Citation

  • Bruce Hollingsworth & Asako Ohinata & Matteo Picchio & Ian Walker, 2017. "Labour Supply and Informal Care Supply: The Impacts of Financial Support for Long-Term Elderly Care," Working Papers 424, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
  • Handle: RePEc:anc:wpaper:424
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    References listed on IDEAS

    as
    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.
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    8. Liliana E. Pezzin & Barbara Steinberg Schone, 1999. "Intergenerational Household Formation, Female Labor Supply and Informal Caregiving: A Bargaining Approach," Journal of Human Resources, University of Wisconsin Press, vol. 34(3), pages 475-503.
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    11. Sarah Karlsberg Schaffer, 2015. "The Effect of Free Personal Care for the Elderly on Informal Caregiving," Health Economics, John Wiley & Sons, Ltd., vol. 24, pages 104-117, March.
    12. Asako OHINATA & Matteo PICCHIO, 2015. "The Financial Support for Long-Term Elderly Care and Household Savings Behaviour," Working Papers 411, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
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    More about this item

    Keywords

    Long-term elderly care; ageing; financial support; informal caregiving; difference-in-differences;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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