The heterogeneous effects of the Great Recession on informal care to the elderly

Jesus Carro and Elizaveta Pronkina

UC3M Working papers. Economics from Universidad Carlos III de Madrid. Departamento de Economía

Abstract: This paper studies the role of unobserved factors to measure the impact of the economic downturn on informal care availability to the elderly in Europe. We use the Survey of Health, Ageing and Retirement in Europe (SHARE), which allows controlling for socio-demographic variables. Our results show that the impact of the Great Recession on care receipt depends not only on observed, but also on unobserved characteristics. For 21 percent of the sample, the effect is three to four times larger than the average effect for the entire sample. For 57 percent of the sample, there is no effect of the economic crisis, and this is due to unobservable factors. In our estimation process, we are able to characterize how this unobserved heterogeneity correlates with the observable variables. Moreover, we show that if the unobserved heterogeneity in the effect of the crisis is ignored, then we are not able to capture that there is no effect for more than half of the individuals, even if we allow for unobserved heterogeneity in the intercept of the model and for the heterogeneous effect of the crisis based on observables.

Keywords: Informal; Care; Great; Recession; Unobserved; Heterogeneity (search for similar items in EconPapers)
JEL-codes: C2 I18 J14 (search for similar items in EconPapers)
Date: 2021-10-13
New Economics Papers: this item is included in nep-age, nep-eur and nep-hea
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Journal Article: The heterogeneous effects of the great recession on informal care to the elderly (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:cte:werepe:33444

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