Three Essays on the Labour Costs of Caring for Elderly Parents in Canada

This dissertation consists of three chapters on the labour costs that workers face from caring for an elderly parent in Canada. The first chapter investigates the causal effect of weekly hours of care provision on the probability of being employed and work hours of children caregivers. I use the General Social Survey (GSS 2012) of Statistics Canada and restrict the sample to parental caregivers and non-caregivers. To start, I treat caregiving as exogeneous. However, an endogeneity bias may arise if some individual’s unobserved characteristics are correlated with the hours of care variable and the employment outcomes at the same time. For instance, individuals, who prefer working as opposed to caring for elderly parents, are expected to provide less care hours.
\nOn the contrary, it can be also caregivers’ ability to balance both work and care that
\ninduce a positive relationship between care hours and work. I use instrumental variable techniques to resolve endogeneity issues. Results show that a 10% increase in hours of
\ncare per week is associated with a 9.8 percentage points reduction in the probability of working for women caregivers compared to their counterparts’ non-caregivers, whereas for men sample, the reduction is 11.6 percentage points. Results also suggest that care
\nhours reduce the estimated weekly hours of work, for both men and women. A 10% increase in weekly care hours is associated with a decrease in weekly hours of work by 9.8% for men, and 1.6% for women sample.
\nThe second chapter re-examines the same question in the context of two different types of informal care: personal and intense care. Helping frail parents with daily personal activities such as eating, bathing or toileting may require larger time commitments than helping them with chores. Moreover, personal care tasks are non-shiftable by nature because they are provided at specific times of the day. In contrast, chores such as cleaning the house and shopping or other organizational activities, can be done through the day or week. Using the same cross-sectional dataset as the first chapter, the study restricts the sample to parental and non-parental caregivers. To control for potential endogeneity bias, I consider three commonly used instruments in the literature; the distance to care-receiver, the health status, and age of the respondent’s care
\nreceiver. Findings show that women and men who provide at least 15 hours of weekly care are less likely to be employed than other caregivers. Moreover, only women who help their parents with personal care are likely to reduce their employment probability.
\nFindings also show that helping with both personal and intense care has no significant impact on estimated weekly hours of work.
\nThe third chapter investigates the impact that parental caregiving has on retirement behaviour of caregivers in Canada and across Canadian regions based on Longitudinal International Study of Adults (LISA) from 2012-2016. The panel structure of the data
\nallows me to use fixed-effect method to control for potential sources of endogeneity that arise from time invariant unobserved heterogeneity like preferences to care or work, ability to balance both activities, level of altruism and other hidden costs. To have
\na deeper look about the impact of parental care on retirement probability, I estimate two different intensities of care. Results show that only women who provide at least 20 hours of care are 5 percentage point more likely to retire than their counterpart parental
\ncaregivers who provide less than 20 hours of care and non-caregivers. Moreover, results indicate that the association between parental care and the probability of retirement varies across Canadian regions. The findings of the paper show that in regions like British Columbia, Quebec and Ontario, where home care expenditures as a percentage of health care expenditures are lower than the national average, parental caregivers are more likely to completely or partially retire. Care provision increases the probability of retirement of parental caregivers living in Quebec by 6%, the effect is 5% in Ontario and 9.8% in British Columbia. Moreover, in-home parental care increases the probability
\nof retirement by 10.5% in Quebec and 18.8% in British Columbia.
\nFinally, the results of this dissertation suggest that helping a frail elderly parent at home carries considerable costs that should be considered by policy makers when designing and funding public long-term care programs.

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