Does care to dependent elderly people living at home increase their mental health?

Summary In France, the number of dependent elderly should d ouble by 2060. It is thus important to address the well-being of this growing share of the population. This work aims at estimating the effects of informal care and formal care on the mental health of dependent elderly. Furthermore, we allow the effect of care to vary de pending on the level of dependence, the gender of the dependent elderly and the relationship between the elderly and the primary informal caregiver. Many theoretical models include a production function of health which has two inputs, formal care and informal care but t his function has not been the subject of many empirical studies. In order to estimate the health production function, we use the French Disability and Health Survey (2008). Using a sample of 4,067 dependent elderly, three equations are jointly estimated by the maximum-likelihood method: mental health, informal care and formal care. Correlated residuals partially take into account the relationship between formal and informal cares and the reverse causality of mental health on care received. We use two mental health indicators: depression and the Mental-Health Inventory (MHI-5). The results show a positive effect of informal care on mental health, for slightly dependent elderly, for individuals receiving care from friends or neighbors and for men receiving care from a daughter or from siblings. Formal care decreases the risk of depression and improves the MHI-5 of elderly dependent people, this last effect being higher for women.