A dynamic analysis of informal care and employment in England

This paper analyzes the dynamics in employment and informal care outcomes of women in England. To this end, we develop a dynamic model to describe pathways leading to a negative correlation between informal care and employment in a cross-section. The model allows for different types of caregiving, correlated permanent unobserved heterogeneity and initial sorting. The model is estimated on data from 6 waves of the BHPS 2000–2005. Our findings suggest modest feedback effects. We find a negative effect of co-residential caregiving on future employment and a negative effect of employment on future co-residential and extra-residential caregiving. We also find evidence of positive state-dependence in caregiving although most of the persistence in such activities is related to unobserved heterogeneity rather than state-dependence.