Immigrant labor and the institutionalization of the U.S.‐born elderly. Issue 5 (21st March 2022)

• Record Type: Journal Article
• Authors: Butcher, Kristin F.; Moran, Kelsey; Watson, Tara
• Other Names: Facchini Giovanni guestEditor.; Rapoport Hillel guestEditor.
• Is Part Of: Review of international economics. Volume 30:Issue 5(2022)
• Page Start: 1375
• Page End: 1413
• Publication Date: 2022-03-21
• Subjects: caregiving -- immigration -- institutionalization; International economic relations -- Periodicals; International finance -- Periodicals; Economic policy -- Periodicals; 330
• DOI: 10.1111/roie.12607
• Languages: English
• ISSNs: 0965-7576

Abstract

Abstract: The U.S. population is aging. We examine whether immigration causally affects the likelihood that the U.S.‐born elderly live in institutional settings. Using a shift‐share instrument to identify exogenous variation in immigration, we find that a 10 percentage point increase in the less‐educated foreign‐born labor force share in a local area reduces institutionalization among the elderly by 1.5 and 3.8 percentage points for those aged 65+ and 80+, a 26%–29% effect relative to the mean. The estimates imply that a typical U.S.‐born individual over age 65 in the year 2000 was 0.5 percentage points (10%) less likely to be living in an institution than would have been the case if immigration had remained at 1980 levels. We show that immigration affects the availability and cost of home services, including those provided by home health aides, gardeners and housekeepers, and other less‐educated workers, reducing the cost of aging in the community.