Who Has Benefited from Nursing Home Expansion in Japan?: The Effects of Government Supply-Side Intervention in the Elderly Care Market

Yoshinori Nishimura and Masato Oikawa

Health, Econometrics and Data Group (HEDG) Working Papers from HEDG, c/o Department of Economics, University of York

Abstract: This study analyzes the relation between the labor force participation of caregivers and the provision of informal in-home elderly care. In Japan, the national government both regulates the market entry of nursing home suppliers and intervenes in the supply side of the eldercare market. Using exogenous variations in this supply side intervention, our analysis finds that the Japanese policy of expanding nursing homes has increased the labor force participation of female workers with low opportunity costs in the labor market while simultaneously reducing their provision of informal care. As the per capita expense of nursing home care is higher than the wage income of most non-regular female workers who tend to provide the bulk of informal in-home care, one may reasonably conclude that the capacity of public nursing homes in Japan has expanded excessively, putting unnecessary pressure both on the Japanese budget and the personal provision of eldercare services.

Keywords: long-term care insurance system; labor supply; medical expenditure; regulation (search for similar items in EconPapers)
JEL-codes: H51 I18 J14 J18 J22 (search for similar items in EconPapers)
Date: 2020-02
New Economics Papers: this item is included in nep-age, nep-dem, nep-gen, nep-hea and nep-ias
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