Paper #1537
- Title:
- Thinking of incentivizing care? The effect of demand subsidies on informal caregiving and intergenerational transfers
- Authors:
- Joan Costa-Font, Sergi Jiménez-MartÃn and Cristina Vilaplana-Prieto
- Date:
- September 2016 (Revised: May 2017)
- Abstract:
- We show that demand side cash subsidies to care recipients alter both caregiving and intergenerational transfer decisions. We exploit a quasi-natural experiment referring to the inception of a universal caregiving allowance (in 2007 and its reduction in 2012). We find a caregiving subsidy (of a magnitude of 530€ in 2011) to increase the probability of informal caregiving by 32% (the intensity of care in 13.5 days/year). Similarly, we find that downstream (upstream) intergenerational transfers increased (decreased) in a magnitude of 29% (15%). The effects concentrate among middle and lower income households, and were attenuated by the reduction of the subsidy.
- Keywords:
- caregiving, intergenerational transfers, difference-in-differences, long-term care, family transfers, exchange motivation, caregiving allowances, demand side cash subsidies.
- JEL codes:
- I18, D14, G22.
- Area of Research:
- Labour, Public, Development and Health Economics / Statistics, Econometrics and Quantitative Methods
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