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Health of Elderly Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers

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Listed:
  • Frimmel, Wolfgang

    (University of Linz)

  • Halla, Martin

    (Vienna University of Economics and Business)

  • Paetzold, Jörg

    (University of Salzburg)

  • Schmieder, Julia

Abstract

We estimate the impact of parental health on adult children's labor market outcomes. We focus on health shocks which increase care dependency abruptly. Our estimation strategy exploits the variation in the timing of shocks across treated families. Empirical results based on Austrian administrative data show a significant negative impact on labor market activities of children. This effect is more pronounced for daughters and for children who live close to their parents. Further analyses suggest informal caregiving as the most likely mechanism. The effect is muted after a liberalization of the formal care market, which sharply increased the supply of foreign care workers.

Suggested Citation

  • Frimmel, Wolfgang & Halla, Martin & Paetzold, Jörg & Schmieder, Julia, 2020. "Health of Elderly Parents, Their Children's Labor Supply, and the Role of Migrant Care Workers," IZA Discussion Papers 13774, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp13774
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    Cited by:

    1. Courtney Coile & Maya Rossin-Slater & Amanda Su, 2022. "The Impact of Paid Family Leave on Families with Health Shocks," NBER Working Papers 30739, National Bureau of Economic Research, Inc.
    2. Shen, Karen, 2024. "Who benefits from public financing of home-based long term care? Evidence from Medicaid," Journal of Public Economics, Elsevier, vol. 236(C).
    3. Felix Glaser & Gerald J. Pruckner, 2023. "A hard pill to swallow? Parental health shocks and children's mental health," Health Economics, John Wiley & Sons, Ltd., vol. 32(12), pages 2768-2800, December.
    4. Davillas, Apostolos & de Oliveira, Victor Hugo & Raftopoulou, Athina, 2024. "Parental Health, Adolescents' Mental Distress and Non-cognitive Skills," IZA Discussion Papers 17239, Institute of Labor Economics (IZA).
    5. Kristin F. Butcher & Kelsey Moran & Tara Watson, 2022. "Immigrant labor and the institutionalization of the U.S.‐born elderly," Review of International Economics, Wiley Blackwell, vol. 30(5), pages 1375-1413, November.
    6. Almuhaisen, Abdulmohsen & Amuedo-Dorantes, Catalina & Furtado, Delia, 2024. "Immigration enforcement and the institutionalization of elderly Americans," Journal of Health Economics, Elsevier, vol. 94(C).
    7. Wen, Jiayi & Huang, Haili, 2024. "Parental health penalty on adult children’s employment: Gender differences and long-term consequences," Journal of Health Economics, Elsevier, vol. 95(C).
    8. Volha Lazuka, 2022. "Household and individual economic responses to different health shocks: The role of medical innovations," Papers 2206.03306, arXiv.org, revised Nov 2022.
    9. Ester Lazzari & Valeria Zurla, 2024. "The Effect of Parental Caregiving on the Fertility Expectations of Adult Children," European Journal of Population, Springer;European Association for Population Studies, vol. 40(1), pages 1-22, December.

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    More about this item

    Keywords

    informal care; formal care; aging; health; labor supply; labor migration;
    All these keywords.

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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