Informal care and long-term labor market outcomes

Abstract

In this paper we estimate long-run effects of informal care provision on female caregivers’ labor market outcomes up to eight years after care provision. We compare a static version, where average effects of care provision in a certain year on later labor market outcomes are estimated, to a partly dynamic version where the effects of up to three consecutive years of care provision are analyzed. Our results suggest that there are significant initial negative effects of informal care provision on the probability to work full-time. The reduction in the probability to work full-time by 4 percentage points (or 2.4–5.0 if we move from point to partial identification) is persistent over time. Short-run effects on hourly wages are zero but we find considerable long-run wage penalties.