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

A model of informal caregiving is presented in which decisions are made by extended households including parents and children. An extended household possibly has both a demand and a supply of elder caregiving by children‐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 equilibrium prices for caregiving by children‐in‐law are established. 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, differences 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 differentials may be related to variation in family institutions, including variation in the prevalence of dowry and brideprice. The policy relevance of the model is discussed.