Family Trajectories and the Burden of Care in the Aftermath of Old-Age Health Shocks

Abstract

Due to increasing longevity and declining fertility, families in many rich countries have experienced sharply rising aging-related care needs at the same time that the labor capacity within those families has fallen. How families meet those care needs given their constraints---and at what cost---is an increasingly important question. This paper shows that sudden declines in the health of elderly Taiwanese adults disrupts the life cycles of their adult children.  Rather than causing substitution away from the labor force, elderly parental health shocks are followed by increased mortality, poorer indicators of health, and reduced marriage and fertility rates. Burdensome care needs are likely a key mechanism, judging from the observable characteristics that predict particularly adverse responses to a parental stroke. We find evidence that allowing families to hire migrant care workers can attenuate the negative associations between old-age health issues and family outcomes, improving the survival, health, and well-being of adult children of the elderly.

Note:

Funding Information: Kuan-Ming Chen acknowledges the support from the National Science and Technology Council grant NSTC 111-2628-H-002-019 and the Yushan Fellow Program by the Ministry of Education (MOE).

Conflict of Interests: No authors have any competing interests to declare.

Keywords: Long-Term Care, Family Welfare, Fertility, Health Shocks, Caregiving

JEL Classification: J14, D10