[Trade-off between formal and informal care in Europe]

To study the relationship between formal and informal care for the dependent population in a number of European countries.

Data from the Survey of Health, Aging and Retirement in Europe for 2004 were used and a bivariate probit model was estimated. Unlike other studies, the present analysis includes the institutional features of the various long-term care systems, in addition to the demographic, health and environmental characteristics of the individual receiving care.

A significant correlation was found between the two options, which reveals that, conditional on receiving care, there was a preference for the combination of both types of care. The results show the importance of health status and living arrangements for defining the combination of formal and informal care. There were substantial differences in the likelihood of the two types of care among European countries. A notable finding was the importance of informal care in Spain in comparison with other countries.

The probability of receiving formal or informal care is higher in countries where families have a legal obligation to look after dependent relatives and where institutionalization rates are higher. This finding should be considered in the design of long-term care policies. Therefore, to control growth of public expenditure and, at the same time, improve caregiver satisfaction, policies that combine distinct formal services should be promoted over the implementation of care allowances.