An extended household model of eldercare by children and children‐in‐law based on Far‐Eastern traditions

• Published date: 01 August 2018
• Author: Shoshana Grossbard
• DOI: http://doi.org/10.1111/rode.12396
• Date: 01 August 2018

SPECIAL ISSUE ARTICLE

An extended household model of eldercare by

children and children-in-law based on Far-Eastern

traditions

Shoshana Grossbard

1,2

1

San Diego State University, San Diego,

California

2

IZA (Institute of Labor Economics),

Bonn, Germany

Correspondence

Department of Economics, San Diego

State University, 5500 Campanile Drive,

San Diego, CA 92182.

Email: shosh@mail.sdsu.edu

Funding Information

Asian Development Bank Institute.

Abstract

A model of informal caregiving is presented in which

decisions are made by extended households including par-

ents and children. An extended household possibly has

both a demand and a supply of elder caregiving by chil-

dren-in-law. A patrilocal version of the model, inspired

from traditional Chinese marriage institutions adopted by

a number of countries in the Far East, leads to derived

demands for caregiving by daughters-in-law and supplies

of caregiving by families of daughters. Market equilib-

rium prices for caregiving by children-in-law are estab-

lished. These prices then provide incentives to which

individual households respond. Payments can be made

during, before, or after marriage. The model can throw

light on gender differences in marital happiness, differ-

ences in the impact of eldercare on the health of in-family

caregivers and on their happiness, and East/West and

regional differences in caregiving obligations of family

members. It also suggests that these geographic differen-

tials may be related to variation in family institutions,

including variation in the prevalence of dowry and bride-

price. The policy relevance of the model is discussed.

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INTRODUCTION

Population ageing implies greater demand for health services, including informal eldercare. In all

countries, even the richest ones, some informal eldercare is supplied by relatives. For instance,

substantial proportions of older households in Japan, the United States and Europe have bee n

DOI: 10.1111/rode.12396

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©2018 John Wiley & Sons Ltd wileyonlinelibrary.com/journal/rode Rev Dev Econ. 2018;22:1022–1038.

receiving informal care from their children (Alessie, Angelini, & Pasini, 2014; Ministry of Health,

Labour and Welfare, 2013). Japan stands out from the United States in its proportion of informal

eldercare provided by daughters-in-law. In Japan in 2013 cohabiting biological children supplied

21.8 percent of informal eldercare whereas children-in-law provided 11.2 percent (Ministry of

Health, Labour and Welfare, 2013). Close to 70 percent of all informal caregivers were women,

and the percentage female among children-in-law caring for the elderly is likely to be even higher

in light of the very large gender differentials in household production observed in Japan. For

instance, if we compare the time that men and women spent on cooking and food-related activities,

Japanese women aged 18 to 64 spent 13.4 times more weekly minutes on such activities than men

of the same age, whereas U.S. women in the same age group spent only 2.8 times more minutes

on this activity than men. The same multiples stood at 3.8 and 3.6 for France and Canada (Fisher

& Robinson, 2011).

A comparison of informal eldercare by children and children-in-law in Japan and the United

States indicates a lesser involvement of children-in-law in the United States. Almost half (47 per-

cent) of caregivers of someone aged 50+in the United States cared for a parent, but only 8 per-

cent for a parent-in-law (National Alliance for Caregiving, 2015).

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This cross-country difference

in time spent caring for older in-laws may be more pronounced for women than for men, given

that in the United States men are relatively more likely to engage in household production, and

patrilocality (the custom whereby a young couple moves to live with the husband’s parents) is

less common.

This paper presents a model that considers the association between in-family caregiving of

the elderly, patrilocality, as well as the prevalence of two kinds of premarital payments: bride-

price (paid to parents of daughters) and dowry (paid by parents of daughters). Like the model of

Van Houtven and Norton (2004, henceforth VHN), the one presented here assumes that individ-

ual decisions regarding in-household caregiving are motivated by self-interest. Em pirical studies

of eldercare supplied by children and transfers by older parents to their children suggest some

degree of self-interest (Lopez Anuarbe, 2013; Nivakoski, 2015). Self-interest may also lead par-

ents to state that their future bequests are conditional on the nursing care their children will pro-

vide (Horioka, 2014). It is also recognized that children’s motivation to care for their elder

parents or parents-in-law could be altruistic (Averett, Sikor, & Argys, 2015; Cox & Rank, 1992;

Grossbard, 2014). It follows from the model that cross-country or regional differences in the pro-

portion of informal eldercare supplied by children-in-law could exist even if we assume that the

Americans and the Japanese are equally self-interested. Instead, these differences could be

explained in terms of different family institutions, such as patrilocality, prevalence of one type of

premarital payment, and authority parents have over their children. This could be useful to policy

makers who need a better understanding of how the cultural and institutional context possibly

influences informal eldercare.

Other points shared by VHN and the models below are the inclusion of a household product ion

function of assistance to older parents and the presence of two sets of decision-makers. In the case

of VHN the two sides are parent and child. In the models below they are extended households

who are on the demand side, willing to pay for caregiving by children-in-law, and those on the

supply side, whose children are willing to provide caregiving to future in-laws.

I present two extended household models in which parents make marriage decisions for their

children, which implies that they have authority over their children and the children accept that

authority. These are assumptions that also underlie Steven Cheung’s (1972) theory of marriage, the

first full-size article analyzing marriage.

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Cheung places his economic analysis of marriage in the

organizational and legal context of traditional China, where fathers yielded enormous power in

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