A micro-econometric analysis of care for the dependent elderly living at home in France: Is there a crowding-out effect of informal caregivers when an elderly dependent receives professional home care ?
This paper focuses on the trade-off between formal care and informal care for disabled elderly people living at home in France. Using data from the French\ Handicap Santé Ménages " survey (2008), we try to answer the question of the effect of an increase in formal home care hours on the participation of informal caregivers. We extend previous literature, which almost exclusively focuses on the e ect of informal care on formal home care. We first estimate a two-part instrumental variable model, to account for endogeneity of formal home care. Then we estimate a bivariate Tobit model in order to take into account the censor of our formal home care variable. Our results confirm that there is a crowding-out effect of informal caregivers, when the elderly dependent person receives more hours of formal home care. Nevertheless, the crowding-out effect of informal caregivers is much lower, when only medical formal home care increases.