Dynamic wage and employment effects of elder parent care

This article formulates and estimates a dynamic discrete choice model of elder parent care and work to analyze how caregiving affects a woman's current and future labor force participation and wages. The model incorporates parental health changes, human capital accumulation, and job offer availability. The estimates indicate that women face low probabilities of returning to work or increasing work hours after a caregiving spell. I use the estimated model to simulate the caregiving, employment, and welfare effects of a longer unpaid work leave than currently available under the Family and Medical Leave Act, a paid leave, and a caregiver allowance.