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Living Arrangements: Health and Wealth Effects

Author

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  • Axel Borsch-Supan
  • Daniel McFadden
  • Reinhold Schnabel

Abstract

This paper investigates the choice of living arrangements among elderly Americans. It has two specific aims. First, because health is not directly measurable and can only be described by indicators such as ADLs and IADLs, it explores a new econometric approach to model the influence of the latent health status on living arrangements. Second, it exploits the NBER Economic Supplement of the Longitudinal Study on Aging to investigate the role of housing and financial wealth in the choice of living arrangements.

Suggested Citation

  • Axel Borsch-Supan & Daniel McFadden & Reinhold Schnabel, 1993. "Living Arrangements: Health and Wealth Effects," NBER Working Papers 4398, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:4398
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    References listed on IDEAS

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    1. Borsch-Supan, Axel & Hajivassiliou, Vassilis A., 1993. "Smooth unbiased multivariate probability simulators for maximum likelihood estimation of limited dependent variable models," Journal of Econometrics, Elsevier, vol. 58(3), pages 347-368, August.
    2. Steven F. Venti & David A. Wise, 1990. "But They Don't Want to Reduce Housing Equity," NBER Chapters, in: Issues in the Economics of Aging, pages 13-32, National Bureau of Economic Research, Inc.
    3. Axel Borsch-Supan & Jagadeesh Gokhale & Laurence J. Kotlikoff & John N. Morris, 1992. "The Provision of Time to the Elderly by Their Children," NBER Chapters, in: Topics in the Economics of Aging, pages 109-134, National Bureau of Economic Research, Inc.
    4. David T. Ellwood & Thomas J. Kane, 1990. "The American Way of Aging: An Event History Analysis," NBER Chapters, in: Issues in the Economics of Aging, pages 121-148, National Bureau of Economic Research, Inc.
    5. Laurence J. Kotlikoff & John N. Morris, 1989. "How Much Care Do the Aged Receive from Their Children? A Bimodal Picture of Contact and Assistance," NBER Chapters, in: The Economics of Aging, pages 151-176, National Bureau of Economic Research, Inc.
    6. K. Jöreskog, 1967. "Some contributions to maximum likelihood factor analysis," Psychometrika, Springer;The Psychometric Society, vol. 32(4), pages 443-482, December.
    7. David A. Wise, 1990. "Issues in the Economics of Aging," NBER Books, National Bureau of Economic Research, Inc, number wise90-1.
    8. Axel Borsch-Supan, 1990. "A Dynamic Analysis of Household Dissolution and Living Arrangement Transitions by Elderly Americans," NBER Chapters, in: Issues in the Economics of Aging, pages 89-120, National Bureau of Economic Research, Inc.
    9. Alan M. Garber & Thomas E. MaCurdy, 1990. "Predicting Nursing Home Utilization among the High-Risk Elderly," NBER Chapters, in: Issues in the Economics of Aging, pages 173-204, National Bureau of Economic Research, Inc.
    10. Axel Börsch-Supan, 1989. "Household Dissolution and the Choice of Alternative Living Arrangements among Elderly Americans," NBER Chapters, in: The Economics of Aging, pages 119-150, National Bureau of Economic Research, Inc.
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    Citations

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    Cited by:

    1. Ainsworth, Martha & Dayton, Julia, 2001. "The impact of the AIDS epidemic on the health of the elderly in Tanzania," Policy Research Working Paper Series 2649, The World Bank.
    2. Mark Bicket & Aparna Mitra, 2009. "Demographics and living arrangements of the minority elderly in the United States," Applied Economics Letters, Taylor & Francis Journals, vol. 16(10), pages 1053-1057.
    3. Pal, Sarmistha, 2007. "Effects of Intergenerational Transfers on Elderly Coresidence with Adult Children: Evidence from Rural India," IZA Discussion Papers 2847, Institute of Labor Economics (IZA).
    4. Eric V. Edmonds & Kristin Mammen & Douglas L. Miller, 2005. "Rearranging the Family?: Income Support and Elderly Living Arrangements in a Low-Income Country," Journal of Human Resources, University of Wisconsin Press, vol. 40(1).
    5. Stern, Steven, 1994. "Two Dynamic Discrete Choice Estimation Problems and Simulation Method Solutions," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 695-702, November.
    6. Walker, Joan & Ben-Akiva, Moshe, 2002. "Generalized random utility model," Mathematical Social Sciences, Elsevier, vol. 43(3), pages 303-343, July.
    7. Titus J. Galama & Patrick Hullegie & Erik Meijer & Sarah Outcault, 2012. "Is There Empirical Evidence For Decreasing Returns To Scale In A Health Capital Model?," Health Economics, John Wiley & Sons, Ltd., vol. 21(9), pages 1080-1100, September.
    8. Galama, T. & Hullegie, P. & Meijer, E. & Outcault, S., 2012. "Empirical evidence for decreasing returns to scale in a health capital model," Health, Econometrics and Data Group (HEDG) Working Papers 12/05, HEDG, c/o Department of Economics, University of York.
    9. Florian Heiss & Michael Hurd & Axel Borsch-Supan, 2003. "Healthy, Wealthy, and Knowing Where to Live: Predicted Trajectories of Health, Wealth and Living Arrangements Among the Oldest Old," NBER Working Papers 9897, National Bureau of Economic Research, Inc.
    10. David Bell & Alasdair Rutherford, 2012. "Long-Term Care and the Housing Market," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(5), pages 543-563, November.
    11. Erik Meijer & Arie Kapteyn & Tatiana Andreyeva, 2011. "Internationally comparable health indices," Health Economics, John Wiley & Sons, Ltd., vol. 20(5), pages 600-619, May.
    12. Liliana E. Pezzin & Robert A. Pollak & Barbara S. Schone, 2007. "Efficiency in Family Bargaining: Living Arrangements and Caregiving Decisions of Adult Children and Disabled Elderly Parents," CESifo Economic Studies, CESifo Group, vol. 53(1), pages 69-96, March.
    13. Arie Kapteyn & Erik Meijer, 2014. "A Comparison of Different Measures of Health and their Relation to Labor Force Transitions at Older Ages," NBER Chapters, in: Discoveries in the Economics of Aging, pages 115-150, National Bureau of Economic Research, Inc.
    14. Aydogan Ulker, 2008. "Household structure and consumption insurance of the elderly," Journal of Population Economics, Springer;European Society for Population Economics, vol. 21(2), pages 373-394, April.
    15. Sarmistha Pal, 2004. "Do Children Act As Old Age Security in Rural India? Evidence from an Analysis of Elderly Living Arrangements," Labor and Demography 0405002, University Library of Munich, Germany, revised 15 Oct 2004.
    16. Euwals, Rob, 2000. "Female Labour Supply, Flexibility Of Working Hours, And Job Mobility," CEPR Discussion Papers 2419, C.E.P.R. Discussion Papers.
    17. Engelhardt, Gary V. & Greenhalgh-Stanley, Nadia, 2010. "Home health care and the housing and living arrangements of the elderly," Journal of Urban Economics, Elsevier, vol. 67(2), pages 226-238, March.
    18. Erik Meijer & Arie Kapteyn & Tatiana Andreyeva, 2008. "Health Indexes and Retirement Modeling in International Comparisons," Working Papers 614, RAND Corporation.
    19. Joan L. Walker & Moshe Ben-Akiva, 2011. "Advances in Discrete Choice: Mixture Models," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 8, Edward Elgar Publishing.
    20. Euwals, Rob, 1999. "Female Labour Supply, Flexibility of Working Hours, and Job Mobility in the Netherlands," IZA Discussion Papers 83, Institute of Labor Economics (IZA).
    21. Ainsworth, Martha & Dayton, Julia, 2003. "The Impact of the AIDS Epidemic on the Health of Older Persons in Northwestern Tanzania," World Development, Elsevier, vol. 31(1), pages 131-148, January.

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    More about this item

    JEL classification:

    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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