Show Summary Details

Page of

PRINTED FROM the OXFORD RESEARCH ENCYCLOPEDIA, ECONOMICS AND FINANCE (oxfordre.com/economics). (c) Oxford University Press USA, 2019. All Rights Reserved. Personal use only; commercial use is strictly prohibited (for details see Privacy Policy and Legal Notice).

date: 12 November 2019

The Economics of Informal Care

Summary and Keywords

Across the globe, the most common means of supporting older disabled adults in their homes is through “informal care.” An informal carer is a family member or friend, including children or adults, who help another person because of their illness, frailty, or disability. There is a rich economics literature on the direct benefits of caregiving, including allowing the care recipient to remain at home for longer than if there was no informal care provided. There is also a growing literature outlining the associated costs of care provision. Although informal care helps individuals with disabilities to remain at home and is rewarding to many carers, there are often negative effects such as depression and lost labor market earnings that may offset some of these rewards. Economists have taken several approaches to quantify the net societal benefit of informal care that consider the degree of choice in caregiving decisions and all direct and indirect benefits and costs of informal care.

Keywords: informal care, labor market outcomes, retirement, economic spillovers, health, healthcare costs, healthcare utilization, endogeneity, long-term care, health economics

Informal Care: The Global Default Source of Assistance for Disabled Adults

Across the globe informal caregivers, or carers, defined for the purposes of this aritcle as “anyone, including children and adults who looks after a family member, partner or friend who needs help because of their illness, frailty, disability” (Medical Directorate and Nursing Directorate, 2014, p. 7), remain the default source for long-term care (LTC). To be clear, we use the LTC to mean “a variety of services (and supports) designed to meet a person’s health or personal care needs during a short or long period of time. These services [and supports] help people live as independently and safely as possible when they can no longer perform everyday activities on their own” (National Institutes of Aging, 2017). The term “long-term services and supports” (LTSS) is also commonly used. In advanced economy countries, including the United States, Canada, Europe, Australia, New Zealand, and some Asian countries, such as Korea, China, Singapore, Japan, and Taiwan (International Monetary Fund, 2015), there are varied supports available to carers, with local or regional public and private efforts in place to provide training and informational support. By contrast, informal caregivers in most emerging market and developing economy countries receive little or no support from national or regional programs and typically operate as the sole providers of LTC beyond acute hospital care (Colombo, Llena-Nozal, Mercier, & Tjadens, 2011; Lundsgaard, 2005; Riedel, 2012).

In the early 2000s, in Europe, Canada, and the United States, advocacy increased for establishing more extensive supports to informal caregivers, reflecting the aging of the population, higher dependency ratios, increased dual-couple working families, and concerns over burgeoning LTC budgets. Changing family structure is also a concern given that stepchildren are less likely to provide care to stepparents (Pezzin, Pollak, & Schone, 2008). More substantial public approaches include explicit monthly payments based on the quantity of care provided or quantity of income lost (e.g., Germany, United Kingdom), workplace flexibility programs for caregivers (e.g., Canada), local authorities being responsible for respite care provision (e.g., The Netherlands), modest state or provincial tax credits for full-time co-residing caregivers (e.g., U.S., Canada), and retirement credits for intensive caregiving (e.g., Germany). Some policy proposals are still in flux. For example, in the United States a national paid family leave policy has been proposed that covers dependent child and elder care; however, as of yet only six states have passed paid leave policies, which are financed by employee payroll taxes (California, New Jersey, Rhode Island, New York, Washington, and District of Columbia). In Canada, there has been significant movement in trying to identify caregivers to match them with supports and services, including assessing their capacity to provide care. In the United States it is a major challenge for healthcare providers to identify caregivers, although laws passed in 2014–2018 in over 35 states, such as the CARE Act, require healthcare systems to document a patient’s caregiver in the electronic medical record upon discharge. In terms of assessing the capacity of caregivers, only a handful of state Medicaid programs require assessments when a family caregiver is relied upon as a part of the treatment plan. Lack of widespread adoption is not surprising. With few supports or alternatives to offer a caregiver who is found to have insufficient capacity to safely provide care, providers may view assessing capacity to have limited value and as a liability risk.

In general, public financing for LTC, including supports for caregivers in Northern Europe and Canada, is more accepted by the population and is more established. Debates focus on best mechanisms, the mix of support through formal versus informal sources, and level of benefit generosity and financing concerns. Specifically, the monetary value of the carer’s allowance in the U.K. is low relative to average earnings (just over 13% of average weekly earnings in 2018) and eligibility is quite restrictive (U.K. Office for National Statistics [ONS], 2017, 2018; “Carer’s Allowance”). Carers only receive support if they provide care for at least 35 hours a week and the person they care for needs to be eligible for a disability allowance under strict verification rules; this verification can be difficult to obtain or may underestimate the level of disability particularly when a person needs care because of mental health conditions (e.g., dementia, post-traumatic stress disorder, serious mental illness). Overall in Europe and Canada, while there is a system of LTC, care is not “free” at the point of access and is financed separately. In most cases, older people receive support for their care (e.g., to pay rent in institutions or for personal care at home) only if they satisfy restrictive wealth conditions. Exceptions exist, such as in Scotland, where personal and nursing care is free for all people over 65 who need it.

The United States does not have a public system in place for LTC except for the most economically vulnerable (Medicaid) or special classes of citizens (e.g., veterans). And any expansion of LTC in the United States is politically polarizing. The failure of the Community Living Assistance Supports and Services (CLASS Act) as a part of healthcare reform in the United States offers lessons about the difficulty of LTC reform even with bipartisan support. The CLASS Act was a voluntary federal LTC insurance program for employees financed through payroll deductions that was removed from the final legislation as unworkable. Additionally, Medicaid expansion, which would be expected to facilitate access to LTC for vulnerable elderly people and potentially ease demands placed on informal caregivers has varied nationally at the state level and has been especially fraught in the South. Due to the difficulty of LTC expansion through public/private partnerships, advocates have turned to caregiver policy design, perhaps in part because it is less polarizing (Ansberry, 2018). After all, many U.S. families have had experience with the shock of needing LTC and the sudden realization that there is no public coverage and no financial plan to deal with it (Sperber et al., 2014); even members of Congress have advocated for a bipartisan plan to support caregivers (Rubin, 2017). Overall, despite well-established and nascent movements to expand supports for informal caregivers in Europe, Canada, and the United States, the majority of caregivers worldwide are not supported by explicit policies and reported needs for training and resources likely remain unmet.

There is a rich economics literature on the direct benefits of caregiving, such as allowing an elderly family member to remain at home, as well as the spillover effects of caregiving, such as effects on inpatient care of the care recipient, health effects on the caregiver, healthcare use of the caregiver, and labour market outcomes of the caregiver. Weighing the benefits and costs to both members of the dyad, as well as spillovers to all members of the family, can help illustrate a more complete picture of the net societal welfare contribution of this “free” resource. Furthermore, by framing this debate and the limited public financing of LTC in advanced economies in terms of the direct and indirect economic effects of caregiving identified in existing research, this article provides an impartial view of the net societal benefit of informal care and informs policymakers who may be considering new policies to provide support for caregivers or formal LTC services.

This article presents a theoretical economics framework to inform empirical research on informal care and labor market outcomes, which can be extended to research on other costs and benefits of informal care. An overview of the debate considers whether informal care is a choice that should be treated endogenously in regression models or a nonchoice, which implies it can be treated as an exogenous variable. A literature review examines the employment and retirement effects of informal care and documents how different thresholds of informal care affect outcomes and heterogeneity of treatment effects. This is followed by a discussion of the role of informal care on caregiver health and welfare and how informal care affects the care recipient’s own healthcare use and costs. Finally, future research directions are described that help quantify the total net societal benefits of informal care and the merit of policy proposals is considered in light of competing policy objectives across different sectors of the economy.1

Economic Theory: Informal Care and Labor Market Phenomena

There is important theoretical work on cooperative and strategic decision-making in selection of informal care (Engers & Stern, 2002; Heidemann & Stern, 1999), the relationship between informal care and formal care (Van Houtven & Norton, 2004), and the relationship between long-term care (LTC) insurance and informal care (e.g., intrafamily moral hazard; Pauly, 1990). This section describes a theoretical framework motivated by labor market phenomena. The bulk of the empirical literature on the economics of informal care focuses on the effect of informal care on labor market outcomes (see the section “Evidence of Effects on Labor Market Outcomes: Employment, Hours, Wages, and Retirement”), but there has been comparatively less emphasis on the theory underlying this relationship. The theoretical model presented here be generalized to consider nonlabor market outcomes such as health production or healthcare, and assumptions can be relaxed to allow informal care to be endogenously determined. This model can also be extended to consider how potential kinks affect the budget line and other associated outcomes.2 For example, frictions in the labor market may be a reason for kinks and discontinuities in the relationship between caregiving and working, given that even if a part-time worker wants to adjust from 30 hours a week to 24 it may be difficult to work 24 hours if the employer defines part-time status as 20 hours a week. Thus, a caregiver may have to drop to 20 hours of work if she wants to continue working.

A consensus has emerged in the literature that suggests that (1) a wide range of labor market outcomes (LMO)s, such as labor force participation (LFP), hours of work, and hourly wages, is inversely related to caregiving in general and to the intensity of caregiving specifically; and (2) caregiving threshold effects are evident when more intensive caregiving reduces LMOs more than less intensive caregiving. The literature does not provide a theoretical basis for the threshold effects or explain whether those effects are associated with kinks or discontinuities in the relationships between caregiving and LMOs. These issues are reviewed herein.

A wide range of alternative specifications may be used to estimate the relationship between the intensity (e.g., hours) of unpaid caregiving (CG) and LMOs (L). Holding other covariates constant, the four main empirical specifications are:

  1. (1) L = β‎0 + β‎1 CG

  2. (2) L = β‎0 + β‎1 CG + β‎2 CG^,where CG^ = 1 if CG≥CG^ otherwise zero,

  3. (3) L = β‎0 + β‎1 CG + β‎2 CG^ + β‎3 CG*CG^

  4. (4) L = β‎0 + β‎1 CG + ∑i {β‎2i CG^i + β‎3i CG*CG^i},

where CG^i = 1 if CG≥CG^I otherwise zero; and CG^i+1≥CG^i.

Specification (1) allows for a continuous relationship between caregiving and LMOs with a uniform incremental effect of caregiving on LMOs shown by the parameter β‎1. Specification (2) introduces the potential for a discontinuity in this relationship when CG exceeds threshold CG^ if β‎2 ≠ 0. Moreover, specification (3) introduces the potential for both a single discontinuity if β‎2 ≠ 0 and a single kink if β‎3 ≠ 0 when a CG threshold is reached. Specification (4) offers a further generalization with the possibility of multiple threshold effects where there may be kinks and/or discontinuities.

Under the general specification of the relationship between CG and LMOs, β‎0 reflects the LMO in the absence of CG, thereby allowing for the role of other covariates; β‎1 represents the change in LMOs for each unit increase in CG below the first CG threshold; β‎2i reflects the abrupt change in LMOs once CG reaches the threshold CG^i; thereafter, the impact of a unit increase in CG depends on the sequence of CG thresholds attained. If CG has just attained CG^j, then the change in LMOs for each unit increase in CG depends on β‎1 + ∑i β‎3i where i = 1,2,….j.

Some researchers have estimated discontinuities in the caregiving relationship (Carmichael & Charles, 2003; Heitmueller, 2007; Jacobs, 2014; Jacobs, Laporte, Van Houtven, & Coyte, 2014; Van Houtven, Coe, & Skira, 2013) while others estimated kinks (Chen, Zhao, Fan, & Coyte, 2015; Lilly, Laporte, & Coyte, 2010). There are no published studies that consider the potential for both discontinuities and kinks; indeed, neither term (“kink,” “discontinuity”) was specifically mentioned in the referenced articles. Almost all studies imposed the same empirical specification on the relationship between CG and all LMOs (participation, hours, and wages), and the literature to date has been silent on the theoretical basis for the specifications used, including the potential for threshold effects.

In the standard labor-leisure choice framework in which CG is treated as an exogenous variable, utility defined over leisure and income is maximized subject to the budget constraint. The solution is often characterized as a two-part problem in which individuals first decide whether to work, which occurs if their reservation wage were lower than their hourly wage when all discretionary hours (i.e., total hours, T, less hours of caregiving, CG) are allocated to leisure. Once the decision is made to participate, choice over hours of work is based on a balance between the marginal utility of leisure relative to the gain in utility from enhanced income. Optimization for hours of leisure results in hours of work that are inversely related to CG when income and leisure are normal goods. An increase in CG is akin to a negative income effect that yields a smooth decline in hours of work and leisure. This smooth transition is based on a continuous decline in the slope along the indifference curves defined over income and leisure. If, however, there were a kink in the indifference curve or, more specifically, a discontinuity in the marginal rate of substitution of leisure for income, then there is the potential basis for CG thresholds. (Furthermore, if there were a kink in the budget line, i.e., where hourly wages were dependent on leisure consumed, or if a change in CG resulted in either sudden transformation of the budget line, then the potential for CG thresholds also materializes.)

While the use of kinks to indifference curves is commonplace in behavioral economics, especially when decisions are anchored on initial endowments, it is more troublesome for mainstream economics as it emphasizes preferences as a key explanation for CG threshold effects. One potential reason for kinks to indifference curves rests on the idea that everyone requires a minimum amount of leisure. In this way, leisure (L) is more valuable when it lies below some threshold, L<L^. In contrast, leisure is more discretionary at larger values to leisure, L>L^.

Indeed, suppose a kink were to occur in indifference curves defined over leisure and income at a single common amount of leisure, L=L^, such that the slope of the indifference curve is greater for smaller values to leisure than for higher values, then the following relationships between hours of CG and hours of work and LFP (LFP) may be derived, as shown in Figure 1:

  1. (1) There is an inverse relationship between CG and both hours of work and LFP.

  2. (2) There are two kinks on the hours-of-work relationship but no discontinuities.

  3. (3) There is a single discontinuity in the LFP relationship but no kinks.

  4. (4) The discontinuity in the LFP relationship occurs at a higher CG value than where the thresholds (i.e., kinks) hold under the hours of work relationship.

  5. (5) None of the empirical studies in the literature to date have offered the opportunity to capture such complex relationships between CG and LMOs.

The Economics of Informal CareClick to view larger

Figure 1. The impact of caregiving on labor force participation (LFP) and hours of work.

Figure 1 summarizes the impact of CG on hours of work and LFP when there is a single kink in indifference curves at a common amount of leisure time, L = L^. At the population level, as CG increases, hours of work and LFP decline. Once CG = CG’’, a kink may occur for the hours of work scheduled with a further kink occurring when CG = CG’’’. Between these two points, leisure lies at its threshold value, L^, and only falls below this value when CG > CG’’’. In contrast, there are no kinks in the relationship between LFP and CG. Rather, a possible discontinuity occurs when CG = CG^, that is, when CG is so large that the time available for both work and leisure is L^. This discontinuity occurs at a CG threshold that exceeds both thresholds shown on the hours of work scheduled. Consequently, the relationship between each LMO and CG is separate and unique and thereby each LMO requires its own specification. The general specification described, which allows for multiple kinks and discontinuities for an array of CG thresholds, is the appropriate specification to use. The literature to date has not undertaken such estimation, but exploring generalized linear model estimation could be used to incorporate these complexities. One reason that theories on caregiving and work (or other outcomes) have not considered these complexities is that caregiving has been subsumed in theories of household work, such as the standard Becker household model. Thus, threshold effects for this particular kind of household work are not generally highlighted given the standard practice of modeling choices in how people spend their time time in terms of continuous hours.

In addition, empirical work may not reflect kinks and discontinuities because the researcher has not considered the possibility that there are threshold effects. Oversimplifying the relationship in the existing empirical work may cause a missed opportunity to identify the pathways by which labor market outcomes change, how this affects the economy and thereby whether and how to support carers. For example, we likely first observe erosions in the intensity of work (i.e., reductions in hours of work) or losses in productivity while at work well before CG reaches a level where there is an abrupt change in LFP. Mapping the consequences of the intensive (LFP) and extensive (hours) on the economy can inform policy generosity to CGs and also help identify who would benefit most from workplace support or flextime policies or those who are likely to need income replacement in the absence of more paid care support. It is also important to consider how this missed opportunity may bias estimates of the relationship between informal care and key outcomes.

The Role of Choice in the Dynamics and Effects of Informal Care

In addition to considering kinks and discontinuities in the relationship between informal care and economic outcomes, it is important to consider the role of choice in moving from theory to empirical estimation of the effect of informal care on economic outcomes. The economic model outlined in the section on “Economic Theory: Informal Care and Labor Market Phenomena” assumes that participation in caregiving is determined by exogenous care need (implying informal care is an exogenous variable in empirical models). However, decisions about caregiving may instead reflect constrained choices based on individual- and household-level cost-benefit calculations and in this case it may not be appropriate to treat caregiving as an exogenous variable.

The expected costs of caregiving, reflecting “caregiver burden” (Adelman, Tmanova, Delgado, Dion, & Lachs, 2014) potentially include loss of earned income if hours of paid work are reduced (Tranmer et al., 2005), out-of-pocket expenses such as laundry costs, treatment costs, travel expenses, and special food costs (Hulme, Carmichael, & Meads, 2016), and any indirect costs associated with ill health and increased stress. Benefits include any satisfaction (process utility) derived from caregiving (Brouwer, Van Exel, Van Der Berg, Van Den Bos, & Koopmanschap, 2005), and there may be efficiency considerations at the household level exploiting comparative advantages in market work and unpaid household labor including caregiving, which leads to gains from specialization (Mincer & Polachek, 1974). This rational choice perspective is supported by evidence that individuals in full-time employment and higher earners are less likely to take on intensive caring responsibilities (e.g., Carmichael, Charles, & Hulme, 2010), although evidence somewhat contradicts these findings (see the section on “Evidence of Effects on Labor Market Outcomes: Employment, Hours, Wages, and Retirement”; Fahle & McGarry, 2017).

The critical feminist economics discourse on altruism, reciprocity, and norms of responsibility provides an alternative perspective that suggests caregiving decisions are much more constrained. For example, people who take on caregiving responsibilities when a family member becomes ill may do so out of sense of responsibility or familial obligation that allows little room to manoeuvre (Badgett & Folbre, 1999; Graham, 1983; Sayegh & Knight, 2011; Twigg & Atkin, 1994). This sense of responsibility or duty may be tied to social attitudes, norms, and expectations. For example, Folbre (1995) defines caring as “labor undertaken out of affection or a sense of responsibility for other people, with no expectation of immediate pecuniary reward” (p. 75). From this perspective, subjective norms, such as perceived social pressure to provide care, are predictors of behavior (Ajzen, 2011). In support of this argument, Cicirelli (1993) found that caregiving is motivated by both a sense of obligation and a sense of attachment and a stronger sense of obligation is associated with greater feelings of burden. The World Health Organization (2012) found “emotional bonds” (i.e., love and affection) were the principle motivation for providing care. The importance of emotional bonds in motivating care and sustaining carer well-being has also been found in the context of dementia care, where preexisting relationships are associated with increased carer well-being (Quinn, Clare, & Woods, 2009). While social norms of caring have traditionally been gendered, conventional roles have evolved and male family members may also feel a strong obligation to care when a need arises. Most caregivers are still female, but males and females are more equally represented among older carers who are providing mainly spousal care (Carmichael & Ercolani, 2016; Colombo, Llena-Nozal, Mercier, & Tjadens, 2011).

A somewhat different argument is that care may be provided as part of a relational or kinship system of reciprocity of either tangible or emotional services (Adams & Sharp, 2013; Daatland & Lowenstein, 2005; Folbre, 1995; Kleinman, 2015). For example, elder care by children reciprocates the original gift of a parent’s care. Reciprocity in these relationships may be reinforced by precautionary expectations of parents about their own future care needs and bequest motives of children. These ideas are implicit in social norms that children should care for their ageing parents and parents should care for their children as legally formalized in France as part of the “L’obligation alimentaire” system. Filial support laws also exist in China and other Asian countries (Serrano, Saltman, & Yeh, 2017). Where filial support laws are not the norm, bequest or exchange motives may be an alternative or additional motivation beyond reciprocity. That is, parents may use the promise of a future monetary transfer to an adult child to obtain informal care from their children (Bernheim, Shleifer, & Summers, 1985). The empirical evidence is mixed on the importance of the bequest motive and there is some support for an exchange motive (Norton & Van Houtven, 2006).

People may also have little choice about whether or not to take on caring responsibilities because they are in poor financial circumstances that limit private care options (“Facts About Carers 2014”). This lack of choice is exacerbated if there are no other family members available to provide care (Qureshi & Walker, 1989). A study of Dutch carers found that the most common reason for caring was “duty” but that other constraints such as being “the only one . . . available” were also mentioned as important factors (Brouwer et al., 2005). In their analysis of the responses of 1,100 caregivers to a U.K. local government survey, Al-Janabi (2018) reported that just over half of carers (52%) said that they cared out of a sense of duty but around a third indicated that no one else was available (39.5%) or there was no money for paid care (32.5%).

Perspectives that highlight normative and societal pressures as well as necessity as constraints on choice suggest that demand creates its own supply and the provision of care is largely exogenous to decisions about paid work. This argument is supported to some extent by evidence that the proportion of women providing intensive (more than 15 hours per week) out-of-home care in the United States has not changed significantly across pre–baby boomer and baby boomer cohorts, even though work demands for women have increased (Jacobs, Van Houtven, Laporte, & Coyte, 2015). Research linking social norms and attitudes to female employment, the division of work within the home, and the provision of unpaid care is also consistent with these social norm driven arguments (Carmichael & Ercolani, 2015; Crompton, Brockmann, & Lyonetter, 2005; Farré & Vella, 2013; Michaud, Heimueller, & Nazarov, 2010). In contrast, a rational choice perspective suggests that whether or not the supply of informal care will rise to meet any increase in demand due to demographic aging will depend more on trends in employment and policies to support working carers as well as any anticipated rewards of caregiving. Whether or not the decision to supply care is truly a choice therefore has implications for policy. In empirical modeling the equivalent implications are in regard to whether or not endogeneity of informal care should be controlled.

In practice, the degree of choice available to potential carers will vary depending on their individual circumstances and those of the people needing care. Individual circumstances are also likely to change over time as the needs of the cared-for change and carers themselves age. In a review of research on choice in caregiving, Arksey and Glendinning (2007) found that carers’ choices were shaped by the nature of the caring relationship and wider organizational factors. They claim that U.K. policy initiatives have largely ignored carers’ choices and suggest it is because the exercise of choice by carers could be problematic for the provision of formal services, particularly if carers wished to relinquish caring activities. Indeed, a 2009–10 survey of 25,000 carers in the U.K. (NHS, 2010) found that while 53% said they were willing or wanted to help out, many perceived little or no choice in becoming a carer; 54% stated that caring was expected of them, 15% stated the care recipient would not want anyone else caring for them, and 12% reported that no one else was available. In their analysis, Al-Janabi, Manca, and Coast (2017) reported that only 32.2% of carers responding to questions about choice in caring were not constrained by either a sense of duty, the lack of anyone else being available to provide care, or lack of funds to pay for care. They also found that choice was more likely to be constrained for carers who themselves were in poor health, were in receipt of state benefits, or were in a primary caring role providing personal care, such as dressing or bathing, or skilled care, such as wound care, for 50 hours a week or more. These results suggest that most intensive caregivers are the most constrained in terms of their caring commitment. In the United States, Schultz, Davies, & McDonald (2012) reported that 44% of their sample said they did not have a choice in taking on a caregiving role. In line with Al-Janabi et al. (2017), Schultz et al. (2012) also found that caring for a longer period of time and providing higher levels of care were associated with less choice. Theory suggests that the reason for taking on a caregiving role and lack of choice are related, and Schultz et al. (2012) linked their finding that caring for a parent or spouse is associated with lack of choice to a sense of obligation in kinship relationships. Broyles et al. (2016) reported that some older adults were reliant on their families as the only viable option for care, mirroring the lack of choice for family caregivers found in Europe.

Lack of choice matters in the context of theory that sees autonomy over one’s life as intrinsic to well-being (Deci & Ryan, 2000; Dolan, Peasgood, & White, 2008) and long-standing evidence that choice and physical and psychological well-being are linked (Langer & Rodin, 1976; Rodin, 1986). Schultz et al. (2012) found that a lack of choice about undertaking caregiving was associated with greater emotional stress, physical strain, and worsening health. Al-Janabi et al. (2017) also found that higher levels of choice among caregivers were associated with higher levels of well-being. They also found that caregivers whose choices were unconstrained (those who had “free choice”) scored higher than noncarers in terms of life satisfaction, happiness, and capability. The opposite was true for carers who reported a lack of choice. These results were confirmed when other potential influences were controlled for. The magnitude of the effects were also higher or at least comparable with the positive impacts of education and homeownership. This evidence suggests that having more choice in taking on a caring role is likely to be associated with higher levels of well-being while more intensive caregiving, which is likely to constrain choice in relation to other areas of life, has a negative impact on well-being. By implication, policy initiatives concerned with improving carer well-being would benefit from targeting caregiver choice; for example, in relation to social care support (Pickard, King, Brimblecombe, & Knapp, 2015), flexibility in combining paid work and care (Bryan, 2012), and self-efficacy (Chenoweth et al., 2016)

Evidence of Effects on Labor Market Outcomes: Employment, Hours, Wages, and Retirement

There is a growing body of evidence highlighting the potential impact of caregiving on labor market outcomes (LMOs). There is variation in whether approaches are cross-sectional or longitudinal, treat informal care as a choice or as given, and studies vary in consideration of kinks in LMO responses versus discontinuities (see the section on “Economic Theory: Informal Care and Labor Market Phenomena”). Overall, the body of evidence indicates that intensive caregivers in particular experience negative effects of caregiving on labor market participation, hours of work, and in some cases wages, for individuals providing between 10 and 20 hours of care per week (Van Houtven, 2015; Berecki-Gisolf, Lucke, Hockey, & Dobson, 2008; Jacobs et al., 2014; Jacobs, Lilly, Ng, & Coyte, 2013). Generally, European and U.S. studies suggest that there is heterogeneity in the responses to caregiving across key domains. Besides intensity, caregivers respond differently based on type of task (chores vs. personal care) and by the caregiver’s gender (male vs. female), by the relationship of caregiver to care recipient (spouse, child, other relative), and by income (lowest quartile versus higher).

A 2013 study, using the Health and Retirement Study (Health and Retirement Study PUD, 2012) (HRS) along with a combined approach of individual fixed effects and Instrumental Variables (IV) to account for endogeneity, found male personal care caregivers were 2.4 percentage points less likely to be in the labor force, whereas female chore caregivers were more likely to be retired compared to noncaregiving females (Van Houtven et al., 2013). Furthermore, female caregivers who continued working decreased hours per week whereas men did not adjust hours. Correspondingly, female caregivers faced a 3% lower wage than noncaregivers, whereas male caregivers faced no wage penalty.

Fahle and McGarry (2017) examined the effects of caregiving on work and earnings among incident adult daughter or daughter-in-law caregivers. Incidence was defined as respondents with at least one living parent or parent-in-law who were not providing care in time t = 0 (their first interview) and began caregiving in time t + 2 (or t + 4, t + 6, and so forth up through 20 years). To examine immediate effects, they examined LMOs in time t + 2 and then looked at longer-term effects thereafter. They used the HRS linked to Social Security data to provide an objective measure of work outcomes. Social Security coverage was used to reflect attachment to the labor force and Social Security earnings measured income changes. The descriptive results contradicted past thinking that persons who choose to act as caregivers are less attached to the labor force. Instead, they found that eventual caregivers are more attached at age 18–44 and that, conditional on having positive earnings, earn more than noncaregivers at prime working ages (18–65). Therefore, the opportunity cost of caregiver time may be higher for caregivers than for noncaregivers rather than lower, and important to consider in measuring spillovers. For example, using approaches that do not consider opportunity cost of time (e.g., replacement cost methods) may underestimate lost welfare from caregiving. Their regression analysis used individual fixed effects to control for selection into caregiving and they found a 2.9 percentage point reduction in the probability of adult daughter caregivers working compared to noncaregivers; for those who remain working, they found a reduction of 1.3 hours per week on average for caregivers compared to noncaregivers. Caregiving did not affect Social Security earnings.

Combined, these two U.S.-focused studies that used the HRS found similar effects on labor force participation (LFP), despite using incident versus prevalent informal caregivers and objective versus self-reported LFP approaches. Because these cited studies are longitudinal, they use a variety of approaches to address endogeneity, either through IV analysis or individual fixed effect regressions.

Van Houtven et al. (2013) also used the HRS and attests a structural model by Skira (2015). They found that providing informal care to their mothers reduced LFP among adult daughters. Although Skira (2015) took a very narrow approach in examining the second (after spouse-to-spouse) most common relationship type, mother-daughter dyads, her policy simulations and careful modeling are illuminating. The former showed that paid and unpaid leave policies were much more effective at keeping a higher proportion of adult daughter caregivers working full time after an intensive caregiving episode, but that a more modest number remained intensively caregiving. By contrast, a generous ($27,000) caregiver allowance was very effective at keeping a large proportion of adult daughters intensively caregiving, but the tradeoff was that there was an accompanying substantial reduction in the proportion of them who remained working full time. These tradeoffs should not be ignored given competing goals of the labor sector to increase female LMP and goals of the health sector to minimize costs of long-term care provision (Van Houtven et al., 2013).

Given that the HRS allows for examination of caregiver’s age 50 and older, understanding the effects of informal care on younger caregivers and caregiving across the life course in the United States has been prohibitive. A new and exciting development in the U.S. literature is a study by Maestas and Truskinovsky (2017), who were able to examine short-term labor market responses to a new informal caregiving episode by using a novel and as of yet unexploited data source for informal care outcomes research. Using the eldercare module of the American Time Use Survey (ATUS), Maestas and Truskinovsky used a “high frequency panel dataset” to examine monthly work changes after the start of a caregiving episode, up through 22 months. Each panel member was interviewed 9 times over 18 to 21 months. In addition, since the ATUS is based on Current Copulation Survey (CPS) respondents, they were able to examine younger caregivers from a nationally representative sample of adults than had been possible, including any type of dyadic relationship (friend or relative). They found that with a median age of 52 among their identified caregivers the HRS is missing data on half of adult caregivers.

In general, the advent of new data sources is valuable to empirical inquiries examining informal care and LMOs to expand our understanding of short-term effects, effects among the young, and effects on lesser studied LMOs such as unemployment and early retirement. The National Longitudinal Survey of Mature Women found that intensive caregivers, defined as those providing 20 hours of informal care a week, are 1 to 3 percentage points more likely to retire relative to other women (Jacobs, Van Houtven, Laporte, & Coyte, 2017). If these female caregivers adjust their work behavior very close to retirement age, it may explain the null Social Security earnings results observed in Fahle and McGarry’s study. That is, marginally earlier retirement may not disrupt the expected Social Security benefit. And yet, for those caregivers who retire much earlier, they will likely have persistent effects on economic well-being, including wage reductions among those who remain working and pension earnings. Uncovering the full range of early retirement responses and permanent labor market exits requires further research.

The European literature on informal care and work is more extensive than the U.S. literature. Specifically, Carmichael and Charles (2003) used a cross-sectional household survey in the U.K. and found that less intensive caregivers are more likely to work, but they work fewer hours per week than similar noncaregivers. Intensive caregivers (<20 hours a week) are modestly less likely to work. Those who continue working however, earn less per hour and work fewer hours per week compared to similar noncaregivers. In a longitudinal analysis using the British Household Panel Survey, Heitmueller and Inglis (2007) use two time points, 1993 and 2002, and find that wage gaps between caregivers and noncaregivers exist, vary by gender, and are larger over time. They also noted that although we can observe worse LMOs over time for caregivers, the mechanisms remain unclear. In addition, unobserved characteristics may explain gaps in wages but could be due to discrimination, which would be interesting from an individual and social policy perspective (implying high opportunity costs in both domains). Additionally, if caregivers suspect they are going to face wage penalties, it may spur anticipatory or reactive labor force exit. These are important considerations in quantifying net societal benefits of informal care as well as informing policy.

A 2018 European paper examines the full age range of working age adult children caregivers (20–65), and uses the Survey of Health, Aging and Retirement (SHARE) (Share Project, 2013) in Europe from 2004–2013 data, covering most countries in Europe (Kolodzeij, Reichert, & Schmitz, 2018).3 Their ample sample size allows them to look at whether male and female caregivers have differential labor market responses. Kolodziej et al. (2018) examine immediate changes in labor force participation for caregivers of older parents who have either received some informal or formal help in the home or reported a disability. The sample restriction is important to keep in mind because most other studies include a broader sample of potential care recipients, not restricting the analysis to those who have disability. The authors find that informal caregiving in the SHARE-represented countries reduces labor force participation by 14 percentage points on average. This is a much larger effect than found in other studies, which could be explained by the restriction to potential care recipients with disability.

The empirical approach assumes that adult children face a choice about whether to become a caregiver or not and uses IV methods to ensure that the effect of informal care on work is not simply picking up the effect of being less interested in work (or having worse health or something else) to begin with. The IVs are number of siblings and whether a parent is widowed by recent death of the spouse. The inference possible in this approach, as the authors point out, is a local average treatment effect. That is, they estimate the labor market changes among those adult children invoked to provide care (or not) due to the availability of other sources of care in the family.

Kolodziej et al. (2018) find that negative labor market implications of caregiving are more pronounced in eastern and southern European countries compared to northern European countries. Besides distinct social attitudes, norms, and expectations that may explain this trend (e.g., more traditional gender roles, multigenerational households, less geographic mobility), there are distinctly different policies that support caregivers in the northeast and southern gradients. In the East and South, there are few publicly provided substitutes to informal care. Thus, the overall finding is driven entirely by the eastern and southern countries and informal care in northern European countries has no discernible effect on labor market participation. It is difficult to disentangle the income effect (northern countries are wealthier) from the generosity of long-term care policy effect (northern LTC benefits are more generous), but it is plausible that the specific policies that support long-term care or the more extensive social safety net in northern European countries drive these findings (Van Houtven, 2018).

Kolodziej, Reichert, and Schmitz (2018) also includes more younger caregivers than most other U.S. and European studies; 10% of the SHARE caregivers were age 20 to 29; 23% were age 30 to 39; and one-third were age 40 to 49. As Kolodziej et al. (2018) point out, by covering the full age distribution of workers, they may be uncovering an impact on a country’s welfare that is hidden in prior work that focused on older caregivers. Indeed, labor market trajectories may be quite different for early versus late in life caregiving episodes (Miller, 2011).

Jacobs, Van Houtven, Tanelian, and Ramchand (2018) examine younger caregivers using the cross-sectional 2013 RAND Survey of Military and Veteran Caregivers. This survey comprises responses from 3,876 caregivers and noncaregivers aged 18 and older. Jacobs et al. (2018) examined the association between intensive caregiving (i.e., providing ≥20 hours of weekly care) and six outcomes: schooling, labor force participation, taking unpaid time off of work, cutting back work hours, quitting a job, and early retirement. They find that intensive caregivers are 13% points less likely to be employed than noncaregivers. Intensive caregivers are 3 percentage points more likely to cut back schooling, 6 points more likely to take unpaid time off of work, 4 points more likely to cut back work hours, 12 points more likely to quit a job, and 5 points more likely retire early due to caregiving responsibilities relative to nonintensive caregivers. Being able to examine schooling outcomes and unpaid time off work are innovations of this paper due to its unique data source. Interestingly, these authors did not find differential effects by age of the caregivers (e.g., those caring for younger, post-9/11 veterans versus those caring for pre-9/11 veterans).

Research from other countries has tended to support the results of research from the United States and Europe. For example Jacobs et al. (2014) found that retirement responses to caregiving in Canada map closely with the response heterogeneity that others have found in other parts of the world. Specifically, using the 2007 Canadian Household Survey, they find that high-intensity caregivers aged 55 to 69 are more likely to be retired and female caregivers are more likely to work part time and that male and female high-intensity caregivers are more likely to be retired before age 65 (Jacobs et al., 2014). Evidence from Asia is growing with some mixed findings. Chen et al. (2015) used simultaneous equation models to account for potential endogeneity and find that intensive caregivers (over 15 or 20 hours per week) were 4.5% to 7.7% less likely to be working; those intensive caregivers who remained working had significantly lower (4.97 to 7.20) weekly hours of work. The significant positive effect of informal care on LFP only existed in the rural sample, and these women also had much lower hours of work than their urban counterparts. Using the Japanese version of SHARE Oshio and Usui (2017) find in an IV and fixed effects framework that there is little effect of informal parent care on female LMOs in Japan. This may be due to the fact that many females do not work and those who do are very attached to work (or worked part time prior to caregiving so have more flexbility) or due to the advanced age distribution of the care recipients, where adult daughters have already left the labor force before assuming a caregiving role.

Evidence of Health and Welfare Effects: Hidden Costs of Informal Care

In addition to the labor market effects of caregiving, carers as a group have been found to suffer disproportionately from poor health (Schulz & Beach, 1999; U.K. Office for National Statistics [ONS], 2013) and self-report lower levels of health and well-being (Bremer et al., 2015). Many older carers have multiple long-term conditions and their own care needs (NICE, 2015). Caregiving has been associated with health problems such as anxiety, insomnia, depression, stress, high blood pressure, lower immune health, and increased risk of cardiovascular and cerebrovascular diseases (Coe & Van Houtven, 2009; Cooper, Balamurali, & Livingston, 2007; Kim & Knight, 2008; Oshio & Usui, 2017; Schmitz & Westphal, 2015; Vitlic et al., 2016). Musculoskeletal injuries such as back injury from lifting have also been linked to caregiving (Hulme et al., 2016). Caregiving is additionally associated with lower levels of well-being (Hansen et al., 2004; Hirst, 2005; Marks, Lambert, & Choi, 2002; van den Berg, Fiebig, & Hall, 2014), quality of life (Farina et al., 2017), and happiness (Niimi, 2016).

However, evidence on the links between caregiving and health and well-being is somewhat mixed, with many studies indicating that these effects depend on the nature of the caring relationship and the individual characteristics and circumstances of the caregiver (Roth, Fredman, & Haley, 2015; U.K. POST, 2018). In particular, the mental and physical health of carers and their overall well-being appears to deteriorate with longer hours of caring (e.g., Bremer et al., 2015; Hirst, 2005; Vlachantoni, Robards, Falkingham, & Evandrou, 2016). For example, Colombo et al. (2011) found that carers have a 20% higher prevalence of mental health problems compared with noncarers (measured by indicators of psychological distress) across OECD member countries but that this difference is higher for intensive carers caring for 20 or more hours a week as well as male caregivers. The effect also differs by country. The negative effects on well-being are also stronger for carers who are closely related to the care recipient (Dolan et al., 2008). Coresidential carers who tend to care for longer hours also report worse health, particularly mental health (Colombo et al., 2011; Kaschowitz & Brandt, 2017).

The transition into caregiving and the duration of the caring episode have also been linked to ill health and lesser well-being (Marks, Lambert, & Choi, 2002; Coe & Van Houtven, 2009). Coe and Van Houtven (2009) found that the start of a caregiving episode has modest immediate negative effects on depressive symptoms for some caregivers with delayed effects on health. They also found that continued caregiving over time increases depressive symptoms and is linked to increased incidence of heart conditions for some caregivers. This analysis indicates that these health changes are directly attributable to caregiving behavior (Coe & Van Houtven, 2009). In line with these results, Carmichael and Ercolani (2016) found a relative deterioration in the health and well-being of people whose career histories over 15 to 20 years were more “caring intensive” (i.e., characterized by a high incidence of caregiving, particularly intensive caregiving undertaken mainly while unemployed). Notably, such people were older and more likely to be female.

Lower well-being among caregivers may be linked to social isolation, loneliness, and lack of support, which contribute to caregiver burden and increase the risk of distress and mental health problems (Colombo et al., 2011; Vasileiou et al., 2017). Carers UK reported that over half of carers responding to their 2014 State of Caring survey had lost touch with friends and family because of their caring responsibilities, and male carers faced particular problems in this respect because of reluctance to describe themselves as carers or to seek support (“State of Caring 2015”). Caregiving may also have a negative impact on well-being by straining personal relationships (“Alone and Caring”; Thandi, Oram, Verey, Greenberg, & Fear, 2017).

Another hidden cost of caregiving is the additional out-of-pocket financial costs, such as higher household bills for food, heating, and cleaning; transportion costs, and hospital parking charges. For those with low or fixed incomes, these out-of-pocket expenses of caregiving constitute a significant proportion of their income, which aggravates their financial hardship and material well-being (Hulme et al., 2016; McGarry & Schoeni, 2005). Working-age caregivers, who are more likely to be female, also face a higher risk of poverty because of lower earnings, lower working hours, and lower employment participation rates (Colombo et al., 2011). The Caring and Family Finances Inquiry: UK Report” (2014) found that 30% of carers had experienced a significant decrease in their household income because of difficulties in combining paid work and care. Carmichael and Ecolani (2015) also found that over a period of 15 to 20 years income gaps widened between people following full-time careers and those whose career histories were more “caring intensive.” Similarly, Wakabayashi and Donato (2006) found a higher probability of U.S. women living below the poverty threshold in later life due to parental caregiving eight years prior.

Adverse effects of caregiving on physical and mental health and negative social effects of caregiving are sometimes referred to as the hidden costs of caregiving (Fast, Williamson, & Keating, 1999; Wilkins, 2014). These costs are linked to psychological, social, or financial caregiver burdens, which can lead to caregiver distress (Adelman et al., 2014; Bevans & Sternberg, 2012). Research indicates that the risk factors for negative impacts of caregiver burden include higher hours of caring, coresidential care, financial stress, and lack of choice in being a caregiver (Adelman et al., 2014). However, some studies find no strong relationships between caring and ill health or psychological well-being and life satisfaction (Leigh, 2010) and instead highlight beneficial effects of caregiving (Brown & Brown, 2014; Kanters, van der Ploeg, Brouwer, & Hakkaart, 2013; Roth et al., 2015). In particular Zapart, Kenny, Hall, Servis, and Wiley (2007) and Yiengprugsawan, Seubsman, and Sleigh (2012) found that the subjective well-being of caregivers is positively associated with elderly care. Rafnsson, Shankar, and Steptoe (2017) also found that among people 50 and older, informal caregiving increased life satisfaction compared with that of noncaregivers. Perhaps, for some caregivers, the value of family commitment and their contribution to the care of a loved one outweighs any perceived caregiver burden.

Informal Care and Care Recipient Healthcare Utilization and Health

The economic impact of informal care from a societal or health system perspective depends on whether informal care and formal healthcare act as substitutes or complements. The prevailing economic models of this relationship are based on a household decision-making process and a health production function (Grossman, 1972; Van Houtven & Norton, 2004) or a care recipients’ ability to perform activities of daily living (Bonsang, 2009; Stabile, Laporte, & Coyte, 2006). In these models, informal and formal care act as inputs in the production of health, and their relationship depends on the sign of the marginal benefit to health of formal care with respect to informal care (Stabile et al., 2006; Van Houtven & Norton, 2004). This implies that the question of whether informal and formal care are substitutes or complements is ultimately an empirical one (Bolin, Lindgren, & Lundborg, 2008a). Though studies often hypothesize that informal care will act as a substitute for home health and nursing home care, there is less certainty around the expected relationship between other types of healthcare and informal care (Bolin et al., 2008; Bonsang, 2009; Van Houtven & Norton, 2004; Weaver, Stearns, Norton, & Spector, 2009).

The empirical approach taken in exploring the relationship between informal and formal care will have a substantial impact on the direction of the relationship. Of particular concern is whether studies account for the endogeneity of informal care in models explaining the use of formal care. Informal care could be endogenous because of the simultaneity of a family member’s decision to provide informal care and a care recipient’s decisions about the type and amount of formal care to use (Bonsang, 2009; Van Houtven & Norton, 2004). Another reason informal care could be endogenous in studies of healthcare utilization is because a study’s measures of health and disability may insufficiently capture variation in care needs. If there is a higher level of unobserved disability present, and higher levels of need are associated with the receipt of informal care, one would expect an upwardly biased coefficient for informal care (Charles & Sevak, 2005).

Early evidence of the relationship between informal and formal care did not take endogeneity into account, and the results of these studies were mixed. This literature focused on the relationship between informal care provision and paid home care or nursing home care. Initially, studies in this area approached the substitute-versus-complement question by assessing how changes in the supply of formal care services were associated with informal care provision. The results of these studies were inconclusive, with some demonstrating no effect of increased formal care on informal care supply (Christianson, 1988), some demonstrating a complementary relationship (Langa, Chernew, Kabeto, & Katz, 2001; Liu, Manton, & Aragon, 2000), and some demonstrating substitution (Pezzin, Kemper, & Reschovsky, 1996).

In the early 21st century, studies have used econometric approaches that account for the endogeneity of informal care in models of home healthcare and nursing home utilization. These studies have demonstrated more consistent findings. Using IV approaches, with children’s characteristics as the instruments, studies in the United States and Europe have demonstrated that a 10% increase in monthly informal care hours leads to a 0.6 to 0.87 percentage point reduction in the probability of a home healthcare use (Bolin et al., 2008a; Van Houtven & E. Norton, 2004). Studies using the U.S. data have also found that informal care provision leads to a reduction in the probability of nursing home entry (Charles & Sevak, 2005; Lo Sasso & Johnson, 2002; Van Houtven & Norton, 2004), the length of a nursing home stay (Van Houtven & Norton, 2004), and long-term care expenditures (Van Houtven & Norton, 2008). Importantly, these studies have demonstrated that without controls for endogeneity, analysis of the same data and subsamples resulted in a significant complementary relationship between informal and formal care (Bolin et al., 2008a; Bonsang, 2009; Charles & Sevak, 2005; Van Houtven & Norton, 2004), highlighting the importance of including controls for endogeneity in these models.

Models that account for endogeneity have also been used in studies approaching the substitution question by looking at how regional variation and change in access to paid formal home care services impacts informal care supply. In both North American and European contexts, studies that account for endogeneity or selection bias have demonstrated that increased (decreased) generosity in home healthcare services decreased (increased) the use of informal care (Golberstein, Grabowski, Langa, & Chernew, 2009; Jimenez-Martin & Prieto, 2012; Stabile et al., 2006). The context wherein these changes occur is important, as demonstrated by studies in Scotland and Korea. Using a difference-in-differences approach, Schaffer (2015) found a 6% increase in the supply of informal care after more generous state provision of home care in Scotland. The author attributes this finding to a higher proportion of individuals being able to stay in their homes. Meanwhile, (Kim & Lim, 2014) use a regression discontinuity approach to understand the effect of increased subsidies for formal home and institutional care on informal care use. The authors found no significant effect on informal care supply at the extensive margin, but did find evidence of an effect at the intensive margin.

The literature has highlighted important nuances in the relationship between informal care and healthcare utilization. Studies that have focused on the level of disability of the care recipient and the intensity of care provision (e.g., through a focus on hours of caregiving thresholds) have highlighted that the substitution effect may be weaker for the more severely disabled and when higher intensity care is provided (Bonsang, 2009; Jacobs et al., 2013). Similarly, the type of tasks performed is important. Bonsang (2009) differentiated between types of formal home care, separating skilled tasks (e.g., nursing care) from unskilled tasks (e.g., paid domestic help), and found that that the substitution effect between informal and formal care was primarily driven by unskilled tasks across nine European countries. Others have differentiated in-home care (e.g., home help and telecare) from out-of-home care (e.g., care homes and adult day centers) and found that the substitution relationship exists for in-home care, but not for out-of-home care (Bremer et al., 2015; Jimenez-Martin & Prieto, 2012). The latter studies differ somewhat from the studies that used U.S. Health and Retirement Study data (e.g., Charles & Sevak, 2005; Lo Sasso & Johnson, 2002; Van Houtven & Norton, 2004), which found a substitution relationship between informal care and both formal home care and nursing home care. This could be due to different econometric approaches, but the differences also highlight the importance of regional context in assessing the relationship between informal and formal care. Bolin et al. (2008a), for instance, found that the substitution effect between informal and formal care was much stronger in central Europe as compared with southern Europe, highlighting the importance of cultural norms and differences in the organization and financing of long-term healthcare across regions.

A handful of studies have focused on the relationship between informal care and healthcare outside the long-term care realm, and findings in this area have been mixed. In the U.S. context, Van Houtven and Norton (2004) found that informal care acts as a substitute for hospital and physician visits, but as a complement to outpatient surgery visits. Meanwhile, using data from the Survey of Health, Aging and Retirement (SHARE) in Europe, Bolin et al. (2008a) uncovered a complementary relationship between informal care hours and the probability of a GP visit, any hospital nights, and the number of specialist and GP visits. In a Swiss study, the authors found that while the probability of hospitalizations was not affected by the availability of coresident informal care, the length of stay was reduced by 1.9 days (Weaver et al., 2009). The contrast in these outcomes highlights the complexity of this relationship. A caregiver acting as an advocate for a patient can increase utilization of some types of care, for instance by facilitating doctors’ visits or helping to overcome denial that more care is needed. He or she may also improve the quality of care and care recipient health, for instance notifying staff of errors during an inpatient stay or listening to instructions during an outpatient visit (Van Houtven & Norton, 2004).

Although most of the mentioned studies are motivated by models where informal care is an input into a care recipient’s health production function, there have been very few studies exploring how informal care receipt impacts a care recipient’s health. Some authors have indirectly addressed this topic by demonstrating that poor caregiver well-being or declines in caregiver health are associated with higher care recipient expenditures and emergency department use in the United States (Ankuda et al., 2017) and higher levels of care need in Japan (Yuda & Lee, 2016). Studies that have directly assessed the impact of care receipt on recipients’ health while also taking the endogeneity of informal care into account have focused on cognitive outcomes or the mental health of care recipients. Using SHARE data and an IV approach, where the gender mix of children was the instrument, Bonsang & Bordone (2013) found that more hours of caregiving to parents outside the home led to lower levels of cognition. The authors argue that this could be due to over-involved caregivers who may erode self-confidence thereby fostering cognitive aging either through skill atrophy or depression that discourages cognitively stimulating activities. Counter to this, however, Barnay & Juin (2016) employed an IV approach using the French Disability and Health Survey (Barral et al., 2009) and found that receiving informal care reduces the risk of depression by 42% and that a one-unit increase in informal care hours improves the Mental Health Inventory (MHI-5) by 1.8 points. Moreover, the authors concluded that when care variables are treated as exogenous, the effect on mental health of the care recipient is underestimated because poor mental health may lead individuals to require more informal care. These limited findings imply that to truly understand the societal impact of informal care provision, we need more evidence exploring its effect on care recipient health outcomes.

Conclusion: Estimating the Full Policy Options

This article has presented a theoretical economics framework to consider the benefits and costs of informal care in the context of labor market outcomes, with general applications to other contexts. We discussed the common assumption that informal care is a “choice” in light of both long-standing approaches to controlling for endogeneity of informal care and evidence based on carers’ perspectives. We presented empirical evidence on labor market outcomes of caregiving in the United States, Europe, Canada, and Asia, the hidden costs of informal care that have been estimated in caregiver mental and physical health domains, and the evidence on whether informal care is a net substitute for paid formal long-term care and healthcare. The research findings presented can help inform discussions regarding the merit of caregiver support policy proposals in light of competing policy objectives across different sectors of the economy (LTC, health, labor).

Theories presented here should be incorporated into empirical work in the field. Models that incorporate both kinks and discontinuities are rare, and understanding these responses would expand the evidence base on informal care’s effect on outcomes. Only through incorporating such complexities will we understand if there are biases in existing approaches and whether we could be doing a better job identifying individuals who would differentially benefit from policy remedies or supports. Future empirical work should also try to resolve and standardize treatment of informal care as exogenous or endogenous. Existing evidence suggests that the degree of choice in caregiving depends on individual circumstances and the nature of the care relationship. However, even if some carers say their choice to provide care was an unconstrained one, many carers perceive that they have little choice in becoming a carer. This may be because of family expectations or because there is no one else available. These differences may explain why, thus far, the empirical evidence of endogeneity in care provision is mixed. While most previous research fails to reject the hypothesis of exogeneity, endogeneity is observed in particular circumstances, for example, in the provision of coresidential care (for a review, see Moussa, 2018). However, endogeneity may be an empirical issue for other reasons such as measurement error, for example in the self-reporting of caregiving hours or unobserved heterogeneity among caregivers. Both of these efforts, examining kinks and discontinuities as well as some final guidance on how to consider endogeneity (if at all) would also enhance our ability to make cross-study comparisons.

The informal care and work literature has started to expand its focus to consider how informal care affects work outcomes for younger caregivers (only young adults and not child carers as far as we know), but we need to learn more about how informal care affects economic security and the health of caregivers more broadly when individuals begin caring at young ages, some even before adulthood. In addition, understanding heterogeneity of effects of informal care by domains of vulnerability could help guide policy interventions more effectively (e.g., immigration status, cultural or ethnic group membership, rural residence, economically vulnerable groups, LGBTQ communities; Chen et al., 2015). Finally, exploring how informal care affects intergenerational outcomes is important because there is evidence of spillovers across generations. For example, exposure to a parent’s caregiving experience can alter the carers’ planning for their own long-term care needs (Coe, Skira, & Van Houtven, 2015) and a parent’s decision to invest in long-term care insurance may reduce informal care of their offspring later in life (Coe, Goda, & Van Houtven, 2015). A glaring omission in the literature is research into how informal care (versus formal care) affects health outcomes of care recipients. Without this evidence, the full net benefits of informal care cannot be known.

Economists interested in informal care should turn to evaluating policies that have already been enacted at local and national levels to help frame whether negative spillover effects of caregiving are ameliorated overall (e.g., better outcomes for each), are exacerbated (e.g., exit labour force and provide poor quality of care), or have mixed effects. Rigorous quasiexperimental methods are needed to understand these policy impacts, which can have various effects on caregivers’ lives. Megan Skira’s 2015 paper used results from her structural model to simulate caregiving and work responses to different policies. Her policy simulations showed that paid and unpaid leave policies were much more effective at keeping a higher proportion of adult daughter caregivers working full time after an intensive caregiving episode, but that a more modest number remained intensively caregiving. By contrast, a generous caregiver allowance of $27,000 was effective at keeping a large proportion of adult daughters intensively caregiving, but a substantial reduction in the proportion who continued to work full time.

These simulation results show that goals of different economic sectors may not be consistent with goals for maintaining informal care as a “free source” of care. If programs are enacted to keep women working as long as possible (e.g., raising full retirement age) they may increase tax revenue but may lead to higher Medicaid costs by reducing informal care (Van Houtven et al., 2013). Similarly, if programs are enacted to sustain informal care supply, they may substitute for some formal care services but may result in a net loss from a government perspective when there are labor force effects (Jacobs et al., 2013). And one may need to look beyond informal care outcomes of supply to obtain a complete picture. Specifically, a policy that expands formal home care benefits may or may not reduce informal care but may increase caregiver well-being and care recipient outcomes.

Even across different informal care policies there can be differential benefits and costs. What differential impacts do other informal care policies have, among respite care programs, carer allowances, consumer-directed programs where patients can pay the caregiver directly, or pension credits for caregivers (Van Houtven, 2018)? Whom do these policies differentially benefit? Lack of details regarding the winners and losers is an important gap in existing studies and this knowledge is needed to inform targeting of policy interventions (Van Houtven, 2018). Despite the difficulty of quantifying the true opportunity costs of informal care, policymakers and researchers need to understand these costs. The higher the opportunity costs of unpaid care provision, the less likely it is that caregivers will provide this care and the less cost-effective this “free” source of care is from a societal perspective (Jacobs et al., 2018).

Further Reading

General Overview

Grabowski, D., Norton, E. C., & Van Houtven, C. H. (2012). Informal care (2nd ed.). Cheltenham, U.K.: Edward Elgar.Find this resource:

Theory

Broese van Groenou, M. I., & De Boer, A. (2016). Providing informal care in a changing society. European Journal of Ageing, 13, 271–279.Find this resource:

Engers, M., & Stern, S. (2002). Long-term care and family bargaining. International Economic Review, 43(1), 1–41.Find this resource:

Folbre, N. (1995). “Holding hands at midnight”: The paradox of caring labour. Feminist Economics, 1, 75.Find this resource:

Heidemann, B., & Stern, S. (1999). Strategic play among family members when making long-term care decisions. Journal of Economic Behavior and Organizations, 40(1), 29–57.Find this resource:

Pauly, M. V. (1990). The rational nonpurchase of long-term care insurance. Journal of Economic Perspectives, 6(3), 3–21.Find this resource:

Caregiving and Choice

Arksey, H., & Glendinning, C. (2007). Choice in the context of informal care-giving. Health and Social Care in the Community, 15, 165–175.Find this resource:

Carmichael, F., Charles, S., & Hulme, C. (2010). Who will care? Employment participation and willingness to supply informal care. Journal of Health Economics, 29, 182–190.Find this resource:

Caregiving and Labor Market Outcomes

Bolin, K., Lindgren, B., & Lundborg, P. (2008b). Your next of kin or your own career? Caring and working among the 50+ of Europe. Journal of Health Economics, 27(3), 718–738.Find this resource:

Carmichael, F., & Charles, S. (2003). The opportunity costs of informal care: Does gender matter? Journal of Health Economics, 22(5), 781–803.Find this resource:

Heitmueller, A. (2007). The chicken or the egg? Endogeneity in labour market participation of informal carers in England. Journal of Health Economics, 26, 536–559.Find this resource:

Moussa, M. M. (2018). The relationship between elder care-giving and labour force participation in the context of policies addressing population ageing: A review of empirical studies published between 2006 and 2016. Ageing and Society, 1–30.Find this resource:

Van Houtven, C. H., Coe, N. B., & Skira, M. M. (2013). The effect of informal care on work and wages. Journal of Health Economics, 32(1), 240–252.Find this resource:

Caregivers’ Health and Welfare Effects

Adelman, R. D., Tmanova, L. L., Delgado, D., Dion, S., & Lachs, M. S. (2014). Caregiver burden: A clinical review. JAMA, 311(10), 1052–1060.Find this resource:

Coe, N. B., & Van Houtven, C. H. (2009). Caring for mom and neglecting yourself? The health effects of caring for an elderly parent. Health Economics, 18(9), 991–1010.Find this resource:

Colombo, F.,Llena-Nozal, A., Mercier. J., & Tjadens, F. (2011). Help Wanted? Providing and Paying for Long-Term Care, OECD Health Policy Studies, OECD Publishing.Find this resource:

Roth, D. L., Fredman, L., & Haley, W. E. (2015). Informal caregiving and its impact on health: A reappraisal from population-based studies. Gerontologist, 55(2), 309–319.Find this resource:

van den Berg, B., Fiebig, D. G., & Hall, J. (2014). Well-being losses due to care-giving. Journal of Health Economics, 35, 123–131.Find this resource:

Caregiver and Care Recipient Health and Utilization

Bolin, K., Lindgren, B., & Lundborg P. (2008a). Informal care and formal care among single-living elderly in Europe. Health Economics, 17, 393–408.Find this resource:

Bonsang, E. (2009). Does informal care from children to their elderly parents substitute for formal care in Europe? Journal of Health Economics, 28(1), 143–154.Find this resource:

Charles, K. K., & Sevak, P. (2005). Can family caregiving substitute for nursing home care? Journal of Health Economics, 24(6), 1174–1190.Find this resource:

Stabile, M., Laporte, A., & Coyte, P. C. (2006). Household responses to public home care programs. Journal of Health Economics, 25(4), 674–701.Find this resource:

Van Houtven, C. H., & Norton, E. C. (2004). Informal care and healthcare use of older adults. Journal of Health Economics, 23(6), 1159–1180.Find this resource:

Caregiving and Economic Evaluations

Goodrich, K., Kaambwa, B., & Al-Janabi, H. (2012). The inclusion of informal care in applied economic evaluation: A review. Value Health, 15(6), 975–981.Find this resource:

Tranmer, J. E., Guerriere, D. N., Ungar, W. J., & Coyte, P. C. (2005). Valuing patient and caregiver time: A review of the literature. PharmacoEconomics, 23(5), 449–459.Find this resource:

References

Adams, V., & Sharp, R. (2013). Reciprocity in caring labor: Nurses’ work in residential aged care in Australia. Feminist Economics, 19, 100–121.Find this resource:

Adelman, R. D., Tmanova, L. L., Delgado, D., Dion, S., & Lachs, M. S. (2014). Caregiver burden: A clinical review. JAMA, 311(10), 1052–1060.Find this resource:

Ajzen, I. (2011). The theory of planned behaviour: Reactions and reflections. Psychology and Health, 26(9), 1113–1127.Find this resource:

Al-Janabi, H. (2018). Do capability and functioning differ? A study of U.K. survey responses. Health Economics, 27(3), 465–479.Find this resource:

Al-Janabi, H., Manca, A., & Coast, J. (2017). Predicting carer health effects for use in economic evaluation. PLoS One, 12(9), e0184886.Find this resource:

Alone and Caring. CarersUK.org. Published January 23, 2015.Find this resource:

Ankuda, C. K., Maust, D. T., Kabeto, M. U., McCammon, R. J., Langa, K. M., & Levine, D. A. (2017). Association between spousal caregiver well-being and care recipient healthcare expenditures. Journal of the American Geriatric Society, 65(10), 2220–2226.Find this resource:

Ansberry, C. (2018, July 20). America is running out of family caregivers, just when it needs them most. Wall Street Journal.Find this resource:

Arksey, H., & Glendinning, C. (2007). Choice in the context of informal care-giving. Health and Social Care in the Community, 15, 165–175.Find this resource:

Badgett, L., & Folbre, N. (1999). Assigning care: Gender norms and economic outcomes. International Labour Review, 138, 311–326.Find this resource:

Barnay, T., & Juin, S. (2016). Does home care for dependent elderly people improve their mental health? Journal of Health Economics, 45, 149–160.Find this resource:

Barral, C., Cuenot, M., Roussel, P. (2009). The 2008-2009 Disability and Health French Survey. P. CTNERHI-WHO-FIC Collaborating Centre for ICF in France.Find this resource:

Berecki-Gisolf, J., Lucke, J., Hockey, R., & Dobson, A. (2008). Transitions into informal caregiving and out of paid employment of women in their 50s. Social Science and Medicine, 67(1), 122–127.Find this resource:

van den Berg, B., Fiebig, D. G., & Hall, J. (2014). Well-being losses due to care-giving. Journal of Health Economics, 35, 123–131.Find this resource:

Bernheim, B. D., Shleifer, A., & Summers, L. H. (1985). The strategic bequest motive. Journal of Political Economy, 93(6), 1045–1076.Find this resource:

Bevans, M., & Sternberg, E. M. (2012). Caregiving burden, stress, and health effects among family caregivers of adult cancer patients. JAMA, 307(4), 398–403.Find this resource:

Bolin, K., Lindgren, B., & Lundborg, P. (2008a). Informal care and formal care among single-living elderly in Europe. Health Economics, 17, 393–408.Find this resource:

Bolin, K., Lindgren, B., & Lundborg, P. (2008b). Your next of kin or your own career? Caring and working among the 50+ of Europe. Journal of Health Economics, 27(3), 718–738.Find this resource:

Bonsang, E. (2009). Does informal care from children to their elderly parents substitute for formal care in Europe? Journal of Health Economics, 28(1), 143–154.Find this resource:

Bonsang, E., & Bordone, V. (2013). The effect of informal care from children on cognitive functioning of older parents. Netspar Discussion Paper No. 1/013-008.Find this resource:

Bremer, P., Cabrera, E., Leino-Kilpi, H., Lethin, C., Saks, K., Sutcliffe, C., . . . Wubker, A. (2015). Informal dementia care: Consequences for caregivers’ health and health care use in 8 European countries. Health Policy, 119(11), 1459–1471.Find this resource:

British Health Panel Survey. Access BHPS Data. Institute for Social and Economic Research.

Broese van Groenou, M. I., & De Boer, A. (2016). Providing informal care in a changing society. European Journal of Ageing, 13, 271–279.Find this resource:

Brouwer, W., Van Exel, J., Van Der Berg, B., Van Den Bos, G., & Koopmanschap, M. (2005). Process utility from providing informal care: The benefit of caring. Health Policy, 74, 85–99.Find this resource:

Brown, M. R., & Brown, L. S. (2014). Informal caregiving: A reappraisal of effects on caregivers. Social Issues and Policy Review, 8, 74–102.Find this resource:

Broyles, I. H., Sperber, N. R., Voils, C. I., Konetzka, R. T., Coe, N. B., & Van Houtven, C. H. (2016). Understanding the context for long-term care planning. Medical Care Research and Review, 73(3), 349–368.Find this resource:

Bryan, M. (2012). Access to flexible working and informal care. Scottish Journal of Political Economy, 59(4), 361–389.Find this resource:

Carer’s Allowance. Gov.UK, 2019.

Caring and Family Finances Inquiry: UK Report. (2014). Retrived from CarersUK.org.Find this resource:

Carmichael, F., & Charles, S. (2003). The opportunity costs of informal care: Does gender matter? Journal of Health Economics, 22(5), 781–803.Find this resource:

Carmichael, F., Charles, S., & Hulme, C. (2010). Who will care? Employment participation and willingness to supply informal care. Journal of Health Economics, 29, 182–190.Find this resource:

Carmichael, F., & Ercolani, M. (2015). Unpaid caring and paid employment: Different life-histories and divergent outcomes. Social Science and Medicine, 156, 1–11.Find this resource:

Carmichael, F., & Ercolani, M. G. (2016). Unpaid caregiving and paid work over life-courses: Different pathways, diverging outcomes. Social Science and Medicine, 156, 1–11.Find this resource:

Charles, K. K., & Sevak, P. (2005). Can family caregiving substitute for nursing home care? Journal of Health Economics, 24(6), 1174–1190.Find this resource:

Chen, L., Zhao, N., Fan, H., & Coyte, P. C. (2015). Informal care and labor market outcomes: Evidence from Chinese married women. Research on Aging.Find this resource:

Chenoweth, L., Stein-Parbury, J., White, D., McNeill, G., Jeon, Y. H., & Zaratan, B. (2016). Coaching in self-efficacy improves care responses, health and well-being in dementia carers: A pre/post-test/follow-up study. BMC Health Services Research, 16, 166.Find this resource:

Christianson, J. B. (1988). The evaluation of the national long-term care demonstration: The effect of channelling on informal caregiving. Health Services Research, 23(1), 99–117.Find this resource:

Cicirelli, V. G. (1993). Attachment and obligation as daughters’ motives for caregiving behavior and subsequent effect on subjective burden. Psychology and Aging, 8(2), 144–155.Find this resource:

Coe, N. B., Goda, G. S., & Van Houtven, C. H. (2015). Family spillovers of long-term care insurance. National Bureau of Economic Research Working Paper Series, No. 21483.Find this resource:

Coe, N. B., Skira, M. M., & Van Houtven, C. H. (2015). Long-term care insurance: Does experience matter? Journal of Health Economics, 40, 122–131.Find this resource:

Coe, N. B., & Van Houtven, C. H. (2009). Caring for mom and neglecting yourself? The health effects of caring for an elderly parent. Health Economics, 18(9), 991–1010.Find this resource:

Colombo, F.,Llena-Nozal. A., Mercier, J., & Tjadens, F. (2011). Help Wanted? Providing and Paying for Long-Term Care, OECD Health Policy Studies, OECD Publishing.Find this resource:

Cooper, C., Balamurali, T. B., & Livingston, G. (2007). A systematic review of the prevalence and covariates of anxiety in caregivers of people with dementia. International Psychogeriatrics, 19(2), 175–195.Find this resource:

Crompton, R., Brockmann, M., & Lyonetter, C. (2005). Attitudes, women’s employment and the domestic division of labour a cross-national analysis in two waves. Work Employment Society, 19(2), 213–233.Find this resource:

Daatland, S. O., & Lowenstein, A. (2005). Intergenerational solidarity and the family-welfare state balance. European Journal of Ageing, 2(3), 174–182.Find this resource:

Deci, E., & Ryan, R. (2000). “What” and “why” of goal pursuits: Human needs and the self-determination of behavior. Psychological Inquiry, 11, 227–268.Find this resource:

Deshpande, M., & Li, Y. (2017). Who is screened out? Application costs and the targeting of disability programs. Unpublished manuscript.Find this resource:

Dolan, P., Peasgood, T., & White, M. (2008). Do we really know what makes us happy? A review of the economics literature on the factors associated with subjective well-being. Journal of Economic Psychology, 29(1), 94–122.Find this resource:

Engers, M., & Stern, S. (2002). Long-term care and family bargaining. International Economic Review, 43(1), 1–41.Find this resource:

England, N. Who is considered a carer?

Facts About Carers 2014. Carers UK.org. Published June 13, 2014.Find this resource:

Fahle, S., & McGarry, M. K. (2017, January). Caregiving and work: The relationship between labor market attachment and parental caregiving. Michigan Retirement Research Center Research Paper No. 2017–356, 36.Find this resource:

Farina, N., Page, T. E., Daley, S., Brown, A., Bowling, A., Basset, T., . . . Banerjee, S. (2017). Factors associated with the quality of life of family carers of people with dementia: A systematic review. Alzheimers and Dementia, 13(5), 572–581.Find this resource:

Farré, L., & Vella, F. (2013). The intergenerational transmission of gender role attitudes and its implications for female labour force participation. Economica, 80, 219–247.Find this resource:

Fast, J. E., Williamson, D. L., & Keating, N. C. (1999). The hidden costs of informal elder care. Journal of Family and Economic Issues, 20(3), 301–326.Find this resource:

Folbre, N. (1995). “Holding hands at midnight”: The paradox of caring labour. Feminist Economics, 1, 73–92.Find this resource:

Golberstein, E., Grabowski, D. C., Langa, K. M., & Chernew, M. E. (2009). Effect of Medicare home health care payment on informal care. Inquiry, 46(1), 58–71.Find this resource:

Goodrich, K., Kaambwa, B., & Al-Janabi, H. (2012). The inclusion of informal care in applied economic evaluation: a review. Value Health, 15(6), 975–981.Find this resource:

Government of France, Administration of Public Services. (2018). Are we obligated to help parents or grandparents in need in France?Find this resource:

Grabowski, D., Norton, E. C., & Van Houtven, C. H. (2012). Informal Care (2d ed.). Cheltenham, U.K.: Edward Elgar.Find this resource:

Graham, H. (1983). Caring: A labour of love. London, U.K.: Routledge.Find this resource:

Grossman, M. (1972). On the concept of health capital and the demand for health. Journal of Political Economy, 80(2), 223–255.Find this resource:

Hansen, R., Tresse, S., Gunnarsson, R. K., Hansen, R., Tresse, S., & Gunnarsson, R. K. (2004). Fewer accidents and better maintenance with active wheelchair check-ups: A randomized controlled clinical trial. Clinical Rehabilitation, 18(6), 631–639.Find this resource:

Health and Retirement Study PUD (2012). Produced and distributed by the University of Michigan with funding from the National Institute on Aging (grant number NIA U01AG009740). Ann Arbor M.Find this resource:

Heidemann, B., & Stern, S. (1999). Strategic play among family members when making long-term care decisions. Journal of Economic Behavior and Organizations, 40(1), 29–57.Find this resource:

Heitmueller, A. (2007). The chicken or the egg? Endogeneity in labour market participation of informal carers in England. Journal of Health Economics, 26, 536–559.Find this resource:

Heitmueller, A., & Inglis, K. (2007). The earnings of informal carers: Wage differentials and opportunity costs. Journal of Health Economics, 26(4), 821–841.Find this resource:

Hirst, M. (2005). Carer distress: a prospective, population-based study. Social Science and Medicine, 61(3), 697–708.Find this resource:

Hulme, C., Carmichael, F., & Meads, D. (2016). What about informal carers and families? In Care at the End of Life (pp. 167–176). New York, NY: Springer.Find this resource:

International Monetary Fund. (2015). Country composition of WEO groups. Washington, DC: IMF.Find this resource:

Jacobs, J. C. (2014). The impact of informal caregiving intensity on labour market outcomes. (Unpublished doctoral dissertation). University of Toronto, Toronto, Canada.Find this resource:

Jacobs, J. C., Laporte, A., Van Houtven, C. H., & Coyte, P. C. (2014). Caregiving intensity and retirement status in Canada. Social Science and Medicine, 102, 74–82.Find this resource:

Jacobs, J. C., Lilly, M. B., Ng, C., & Coyte, P. C. (2013). The fiscal impact of informal caregiving to home care recipients in Canada: How the intensity of care influences costs and benefits to government. Social Science and Medicine, 81, 102–109.Find this resource:

Jacobs, J. C., Van Houtven, C., Laporte, A., & Coyte, P. (2015). Baby boomer caregivers in the workforce: Do they fare better or worse than predecessors? Journal of the Economics of Ageing, 6, 89–101.Find this resource:

Jacobs, J. C., Van Houtven, C., Laporte, A., & Coyte, P. (2017). The impact of informal caregiving intensity on women’s retirement in the United States. Journal of Population Ageing, 10(2), 159–180.Find this resource:

Jacobs, J. C., Van Houtven, C., Tanelian, T., & Ramchand, R. (2018). Economic spillover effects of intensive unpaid caregiving. Innovation in Aging, 2(Suppl. 1), 581.Find this resource:

Jimenez-Martin, S., & Prieto, C. V. (2012). The trade-off between formal and informal care in Spain. European Journal of Health Economics, 13(4), 461–490.Find this resource:

Kanters, T. A., van der Ploeg, A. T., Brouwer, W. B., & Hakkaart, L. (2013). The impact of informal care for patients with Pompe disease: An application of the CarerQol instrument. Molecular Genetics and Metabolism, 110(3), 281–286.Find this resource:

Kaschowitz, J., & Brandt, M. (2017). Health effects of informal caregiving across Europe: A longitudinal approach. Social Science and Medicine, 173, 72–80.Find this resource:

Kim, H. B., & Lim, W. (2014). Long-term care insurance, informal care, and medical expenditures. Journal of Public Economics, 125, 128–142.Find this resource:

Kim, J. H., & Knight, B. G. (2008). Effects of caregiver status, coping styles, and social support on the physical health of Korean American caregivers. Gerontologist, 48(3), 287–299.Find this resource:

Kleinman, A. (2015). Care: In search of a health agenda. Lancet, 386(9990), 240–241.Find this resource:

Kolodziej, I. W. K., Reichert, A. R., & Schmitz, H. (2018). New evidence on employment effects of informal care provision in Europe. Health Services Research Journal, 53(4), 2027–2046.Find this resource:

Langa, K. M., Chernew, M. E., Kabeto, M. U., & Katz, S. J. (2001). The explosion in paid home health care in the 1990s: Who received the additional services? Medical Care, 39(2), 147–157.Find this resource:

Langer, E. J., & Rodin, J. (1976). The effects of choice and enhanced personal responsibility for the aged: A field experiment in an institutional setting. Journal of Personality and Social Psychology, 34(2), 191–198.Find this resource:

Leigh, A. (2010). Informal care and labor market participation. Labour Economics, 17, 140–149.Find this resource:

Lilly, M. B., Laporte, A., & Coyte, P. C. (2010). Do they care too much to work? The influence of caregiving intensity on the labour force participation of unpaid caregivers in Canada. Journal of Health Economics, 29(6), 895–903.Find this resource:

Liu, K., Manton, K. G., & Aragon, C. (2000). Changes in home care use by disabled elderly persons: 1982–1994. Journals of Gerontology, Series B, Psychological Sciences and Social Sciences, 55(4), S245–253.Find this resource:

Lo Sasso, A. T., & Johnson, R. W. (2002). Does informal care from adult children reduce nursing home admissions for the elderly? Inquiry, 39(3), 279–297.Find this resource:

Lundsgaard, J. (2005). Consumer direction and choice in long-term care for older persons, including payments for informal care: How can it help improve care outcomes, employment and fiscal sustainability? OECD Health Working Papers. Directorate for Employment, Labour and Social Affairs.Find this resource:

Marks, N., Lambert, J., & Choi, H. (2002). Transitions to caregiving, gender and psychological wellbeing: A prospective US national study. Journal of Marriage and Family, 64, 657–667.Find this resource:

McGarry, K., & Schoeni, R. F. (2005). Widow(er) poverty and out-of-pocket medical expenditures near the end of life. Journals of Gerontology, Series B, 60(3), S160–168.Find this resource:

Medical Directorate and Nursing Directorate (2014). NHS England’s Commissioning for Carers: Principles and resources to support effective commissioning for adult and young carers. England: National Health System, 7.Find this resource:

Michaud, P., Heimueller, A., & Nazarov, Z. (2010). A dynamic analysis of informal care and employment in England. Labour Economics, 17(3), 455065.Find this resource:

Miller, A. R. (2011). The effects of motherhood timing on career path. Journal of Population Economics, 24(3), 1071–1100.Find this resource:

Mincer, J., & Polachek, S. (1974). Family investments in human capital: Earnings of women. In T. Schulz (Ed.), Marriage, family, human capital, and fertility. Cambridge, MA: National Bureau of Economic Research.Find this resource:

Moussa, M. M. (2018). The relationship between elder care-giving and labour force participation in the context of policies addressing population ageing: A review of empirical studies published between 2006 and 2016. Ageing and Society, 1–30.Find this resource:

NHS. (2010). Survey of carers in households 2009/10.Find this resource:

National Institute for Health and Care Excellence (NICE). (2015). Older people with social care needs and multiple long-term conditions. Nice.org.uk.Find this resource:

National Institute of Aging. (2017). "What Is Long-Term Care?"Find this resource:

Niimi, Y. (2016). The “costs” of informal care: an analysis of the Impact of Elderly Care on Caregivers’ Subjective Well-being in Japan. Review of Economics of the Household, 14, 779–810.Find this resource:

Oshio, T., & Usui, E. (2017). Informal parental care and female labour supply in Japan. Applied Economics Letters, 24(9), 635–638.Find this resource:

Pauly, M. V. (1990). The rational nonpurchase of long-term care insurance. Journal of Economic Perspectives, 6(3), 3–21.Find this resource:

Pearlin, L. I., Mullan, J. T., Semple, S. J., & Skaff, M. M. (1990). Caregiving and the stress process: An overview of concepts and their measures. Gerontologist, 30(5), 583–594.Find this resource:

Pezzin, L. E., Kemper, P., & Reschovsky, J. (1996). Does publicly provided home care substitute for family care? Experimental evidence with endogenous living arrangements. Journal of Human Resources, 31(3), 650–676.Find this resource:

Pezzin, L. E., Pollak, R. A., & Schone, B. S. (2008). Parental marital disruption, family type, and transfers to disabled elderly parents. Journals of Gerontology: Social Sciences, 63B, S349–S358.Find this resource:

Pickard, L., King, D., Brimblecombe, N., & Knapp, M. (2015). The effectiveness of paid services in supporting unpaid carers’ employment in England. Journal of Social Policy, 44(3), 567–590.Find this resource:

Quinn, H., Clare, L., & Woods, B. (2009). The impact of the quality of relationship on the experiences and wellbeing of caregivers of people with dementia: A systematic review. Aging and Mental Health, 13, 143–154.Find this resource:

Qureshi, H., & Walker, A. (1989). The caring relationship: Elderly people and their families. Basingstoke, U.K.: Macmillan Education.Find this resource:

Rafnsson, S. B., Shankar, A., & Steptoe, A. (2017). Informal caregiving transitions, subjective well-being and depressed mood: Findings from the English Longitudinal Study of Ageing. Aging and Mental Health, 21(1), 104–112.Find this resource:

Riedel, M. (2012, October). Financial support for informal care provision in European countries: A short overview. Health and Ageing Newsletter.Find this resource:

Rodin, J. (1986). Aging and health: Effects of the sense of control. Science, 233(4770), 1271–1276.Find this resource:

Roth, D. L., Fredman, L., & Haley, W. E. (2015). Informal caregiving and its impact on health: a reappraisal from population-based studies. Gerontologist, 55(2), 309–319.Find this resource:

Rubin, R. R. (2017, November 10). Members of Congress on their caregiving challenges. Forbes.Find this resource:

Sayegh, P., & Knight, B. G. (2011). The effects of familism and cultural justification on the mental and physical health of family caregivers. Journals of Gerontology Series B, 66(1), 3–14.Find this resource:

Schaffer, S. K. (2015). The effect of free personal care for the elderly on informal caregiving. Health Economics, 24(Suppl. 1), 104–117.Find this resource:

Schmitz, H., & Westphal, M. (2015). Short- and medium-term effects of informal care provision on female caregivers’ health. Journal of Health Economics, 42, 174–185.Find this resource:

Schulz, R., & Beach, S. R. (1999). Caregiving as a risk factor for mortality: The Caregiver Health Effects Study. Journal of the American Medical Association, 282(23), 2215–2219.Find this resource:

Serrano, R., Saltman, R., & Yeh, M. J. (2017). Laws on filial support in four Asian countries. Bulletin of the World Health Organization, 95(11), 788–790.Find this resource:

Schultz, E., Davies, S., & McDonald, K. (2012). Development of quality indicators for home and community-based services population: Technical Report. Center for Primary Care and Outcomes Research, Stanford University, 1–175.Find this resource:

Share Project. (2013). Survey of Health and Ageing and Retirement in Europe. Share Data Releases.Find this resource:

Skira, M. (2015). Dynamic wage and employment effects of elder parent care. International Economic Review, 56(1), 63–93.Find this resource:

Sperber, N., Voils, C., Coe, N., Konetzka, R., Boles, J., & Van Houtven, C. (2014). How can adult children influence parents’ long-term care insurance purchase decisions? Gerontologist, 57(2), 292–299.Find this resource:

Stabile, M., Laporte, A., & Coyte, P. C. (2006). Household responses to public home care programs. Journal of Health Economics, 25(4), 674–701.Find this resource:

State of Caring 2015. CarersUK.org, 2015.Find this resource:

Thandi, G., Oram, S., Verey, A., Greenberg, N., & Fear, N. T. (2017). Informal caregiving and intimate relationships: the experiences of spouses of UK military personnel. Journal of the Royal Army Medical Corps, 163(4), 266–272.Find this resource:

Tranmer, J. E., Guerriere, D. N., Ungar, W. J., & Coyte, P. C. (2005). Valuing patient and caregiver time: A review of the literature. PharmacoEconomics, 23(5), 449–459Find this resource:

Truskinovsky, Y., & Maestas, N. (2018). Caregiving and labor force participation: new evidence from the american time use survey. Innovation in Aging, 2(Suppl. 1), 580.Find this resource:

Twigg, J., & Atkin, K. (1994). Carers perceived: Policy and practice in informal care. Buckingham, U.K.: Open University Press.Find this resource:

U.K. Office for National Statistics. (2013). 2011 census analysis: Unpaid care in England and Wales, 2011 and comparison with 2001.Find this resource:

U. K. Office for National Statistics. (2017). Annual survey of hours and earnings: 2017 provisional and 2016 revised results. Statistical Bulletin.Find this resource:

U.K. Office for National Statistics. (2018). UK labour market: August 2018. Statistical Bulletin.Find this resource:

U.K. Parliamentary Office of Science and Technology (POST). (2018). Unpaid care.Find this resource:

Van Houtven, C. H. (2015). Informal care and economic stressors. In J. E. Gaugler & R. L. Kane (Eds.), Caregiving in the new normal (pp. 105–136). London, U.K.: Academic Press.Find this resource:

Van Houtven, C. H. (2018). Bringing invisible partners in care out of the shadows: Employment effects of informal care provision in Europe and implications for the United States. Health Services Research, 53(4), 10–2019.Find this resource:

Van Houtven, C. H., Coe, N. B., & Skira, M. M. (2013). The effect of informal care on work and wages. Journal of Health Economics, 32(1), 240–252.Find this resource:

Van Houtven, C. H., & Norton, E. C. (2004). Informal care and health care use of older adults. Journal of Health Economics, 23(6), 1159–1180.Find this resource:

Van Houtven, C.H., & Norton, E. C. (2006). Economic effects of informal care. Swiss Journal of Economics and Statistics, 142(Special Issue), 13–22Find this resource:

Van Houtven, C. H., & Norton, E. C. (2008). Informal care and Medicare expenditures: Testing for heterogeneous treatment effects. Journal of Health Economics, 27(1), 134–156.Find this resource:

Vasileiou, K., Barnett, J., Barreto, M., Vines, J., Atkinson, M., Lawson, S., & Wilson, M. (2017). Experiences of loneliness associated with being an informal caregiver: A qualitative investigation. Frontiers in Psychology, 8, 585.Find this resource:

Vitlic, A., Lord, J. M., Taylor, A. E., Arlt, W., Bartlett, D. B., Rossi, A., . . . Phillips, A. C. (2016). Neutrophil function in young and old caregivers. British Journal of Health Psychology, 21(1), 173–189.Find this resource:

Vlachantoni, A., Robards, J., Falkingham, J., & Evandrou, M. (2016). Trajectories of informal care and health. SSM Population Health, 2, 495–501.Find this resource:

Wakabayashi, C., & Donato, K. M. (2006). Does caregiving increase poverty among women in later life? Evidence from the Health and Retirement survey. Journal of Health and Social Behavior, 47(3), 258–274.Find this resource:

Weaver, F., Stearns, S. C., Norton, E. C., & Spector, W. (2009). Proximity to death and participation in the long-term care market. Health Economics, 18(8), 867–883.Find this resource:

World Health Organization. (2012). Dementia: A public health priority.Find this resource:

Wilkins, R., Ed. (2014). The characteristics and wellbeing of carers. In R. Wilkins (Eds.), Families, Incomes and Jobs. Melbourne Institute of Applied Economic and Social Research.Find this resource:

Yiengprugsawan, V., Seubsman, S. S., & Sleigh, A. C. (2012). Psychological distress and mental health of Thai caregivers. Psychological Well Being, 2(4), 1–11.Find this resource:

Yuda, M., & Lee, J. (2016). Effects of informal caregivers’ health on care recipients. Japanese Economic Review, 67(2), 192–210.Find this resource:

Zapart, S., Kenny, P., Hall, J., Servis, B., & Wiley, S. (2007). Home-based palliative care in Sydney, Australia: The carer’s perspective on the provision of informal care. Health and Social Care in the Community, 15(2), 97–107.Find this resource:

Notes:

(1.) We focus on recent literature generally. For other reviews of the economics of informal care see Grabowski, Norton, and Van Houtven (2012) and Van Houtven (2015). For a review of informal care in economic evaluations, see Goodrich, Kaambwa, and Al-Janabi (2012).

(2.) We focus on economic theoretical models but there are also many behavioral models of informal care supply, including the stress-coping model by (Pearlin, Mullan, Semple, & Skaff, 1990) and a new model proposed by (Broese van Groenou & De Boer, 2016). In the section on Choice we discuss models from Folbre and colleagues on the notion of “choice.”

(3.) Bolin, Lindgren, & Lundborg, 2008a not discussed here, also uses SHARE.