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

63 Pages Posted: 9 Feb 2022

See all articles by Yoshinori Nishimura

Yoshinori Nishimura

Chiba Institute of Technology

Masato Oikawa

Waseda University - Faculty of Education and Integrated Arts and Sciences; Waseda University - Waseda Institute of Social and Human Capital Studies (WISH)

Date Written: February 9, 2022

Abstract

This study analyzes the relationship between the labor force participation of caregivers and the provision of informal in-home elderly care. In Japan, the national government regulates the market entry of nursing home suppliers, and accordingly intervenes in the supply side of the elderly care 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, but simultaneously reduced 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 on both the Japanese budget and the personal provision of eldercare services.

Keywords: long-term care insurance system, informal elderly care, labor supply, medical expenditure, regulation

JEL Classification: H51, I18, J14, J18, J22

Suggested Citation

Nishimura, Yoshinori and Oikawa, Masato, Who Has Benefited from Nursing Home Expansion in Japan?: The Effects of Government Supply-Side Intervention in the Elderly Care Market (February 9, 2022). Available at SSRN: https://ssrn.com/abstract=4030677 or http://dx.doi.org/10.2139/ssrn.4030677

Yoshinori Nishimura

Chiba Institute of Technology ( email )

2-17-1, Tsudanuma, Narashino
Chiba
Japan

Masato Oikawa (Contact Author)

Waseda University - Faculty of Education and Integrated Arts and Sciences ( email )

1-6-1 Nishi-waseda
Shinjuku-ku
Tokyo, 1698050
Japan

Waseda University - Waseda Institute of Social and Human Capital Studies (WISH)

Japan

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