Local variability in long-term care services: local autonomy, exogenous influences and policy spillovers

In many countries, public responsibility over the funding and provision of long-term care services is held at the local level. In such systems, long-term care provision is often characterised by significant local variability. Using a panel dataset of local authorities over the period 2002-2012, the paper investigates the underlying causes of variation in gross social care expenditure for older people in England. The analysis distinguishes between factors outside the direct control of policy makers, local preferences and local policy spillovers. The results indicate that local demand and supply factors, and to a much lesser extent local political preferences and spatial policy spillovers, explain a large majority of the observed variation in expenditure.