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Contribution Details

Type Working Paper
Scope Discipline-based scholarship
Title Dynamic modelling of long-term care decisions
Organization Unit
  • Michelle S. Sovinsky
  • Steven Stern
  • English
Institution University of Zurich
Series Name Working paper series / Department of Economics
Number 113
ISSN 1664-7041
Number of Pages 21
Date 2013
Abstract Text This paper describes and analyzes research on the dynamics of long-term care and suggests directions for the literature to make progress. We discuss sources and causes of dynamics including inertia/state dependence (confounded by unobserved heterogeneity); match-specific effects; and costs of changing caregivers. We comment on causes of dynamics including learning/human capital accumulation; burnout; and game-playing. We suggest how to deal with endogenous geography; dynamics in discrete and continuous choices; and equilibrium issues (multiple equilibria, dynamic equilibria). Next, we evaluate the advantages of different potential data sources (NLTCS, PSID, AHEAD/HRS, SHARE, ELSA) and identify first order data problems including noisy measures of wealth and family structure. We suggest some methods to handle econometric problems such as endogeneity (work, geography) and measurement error. Finally, we discuss potential policy implications of dynamics including the effect of dynamics on parameter estimates and direct policy implications of inertia (implications for family welfare, parent welfare, child welfare, and cost of government programs).
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Keywords Ambulanter Hilfs- und Pflegedienst, Pflegekosten, Familienentlastender Dienst, Sozialpolitik