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UMass Amherst ECON 103 - Class 6 Care labor Fall 2014

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More Problems with Markets Caring Labor 1 14 19 09 34 AM06 42 40 AM Today s Big Points Care Economy is big and becoming bigger people live longer and need more education Some care is done through the market Some by family and friends Fundamental problems with care market Idiosyncratic care and asymmetric information care givers cannot pay for care themselves care providers compete with free care Problems with marketplace care are gendered issue Why we care about care Caring labor nurtures and educates people It produces public goods We all benefit from a healthier better educated more productive population We want to live with people with good values honesty and a sense of personal responsibility Sometimes we all need somebody to lean on Yes we do Because things happen to people Childhood is longer affluent societies nurture creativity and cooperation On the other end we live longer and need more care In between we often need care because of illness or disability 1 14 19 09 34 AM06 42 41 AM What is the difference between And 1 14 19 06 42 41 AM Maybe it is 1 14 19 06 42 41 AM We all need care sometimes A quarter of us need care now Because we may have problems we buy insurance We buy insurance because things may happen We give up income now for protection if those bad things happen The care economy is communal insurance We take care of elderly and look out for needy because we may need care ourselves Sometimes it is specific care for our friends and expect them to do same Sometimes it is generalized reciprocity 1 14 19 06 42 41 AM Some care work is coordinated through the market Including nurses doctors girl friends homehealth aides and some teachers Some even prefer to pay for care Much is done by family and friends Care usually comes from a mix of market and nonmarket providers Market Nonmarket Childcare centers and homes Restaurant and take out meals Cleaning services Schools Eldercare Nurses and doctors Prostitution Family time Home cooking Vacuuming and home laundry Family reading time Visiting grandmother Mom Love Who cares for your grandmother Raise your hands 1 2 3 4 5 No one she is fine on her own She lives with her daughters her sons A home health aide A nursing home Other Three peculiarities of care work Care labor is undervalued because traditionally it is done for free by daughters wives and mothers People who need care cannot pay for it themselves market care depends on thirdparty payments Those who receive care need idiosyncratic help and cannot shop around These lead to problems with the care economy Care workers are poorly paid leading to over work and excessive turnover People who need care don t get enough Those who need care can t use market exit to protect themselves University of Massachusetts Professor Folbre has written on this In a market economy those who need care are disproportionately poor Children have over twice the poverty rate of adults FPL refers t the Federal Poverty Line Those whose income is below that level are officially poor Why aren t they rich They are too young too sick too old to earn much 1 14 19 09 34 AM06 42 41 AM Or their problems have just become too great for them to cope Those who need care survive on the kindness of strangers Like Blanche Dubois Caring for others can be a really bad idea Care givers work for those who cannot pay much Care work has to be subsidized by others such as husbands or the government Care givers compete with the free labor of mothers and daughters Those who care are often poor They devote themselves to those who cannot pay well They compete with free labor of mothers and daughters Taking care of the poor is a lousy way to get rich This is especially important for women They dominate the care economy both market and nonmarket and suffer economically for it Occupation Employment 000s 2 701 Percentage Female 82 2 2 529 91 3 Nursing psychiatric and home health aides Maids and housekeeping cleaners 1 906 88 9 1 423 90 3 Child care workers 1 401 94 2 Hairdressers hairstylists and cosmetologists Other teachers and instructors 767 93 4 705 64 9 Personal and home care aides 703 87 3 Social workers 698 82 6 Preschool and kindergarten teachers 690 97 7 13 523 88 Elementary and middle school teachers Registered nurses Total Having children makes families poor Should parents bear the full cost of their children 1 Yes children are a consumption good just like jet skis or a wine collection 2 No children are a social investment important to everyone 3 Yes we don t want to encourage people to have children 4 No we should not punish people for having children 1 14 19 09 34 AM06 42 42 AM Market Competition does not Lead to Efficient Care Care provided idiosyncratically cannot easily change care givers Know each other intimately asymmetric information with trust built through experience Care givers do not pay for care third party payers may not value quality care Care is expensive leading to search for cheap provision Care depends on emotional connections Those needing care cannot pay for it or shop around They lack money strength and depend on the idiosyncratic knowledge of care givers Without good exit care recipients are beholden to caregivers Some caregivers are unworthy of trust 1 in 4 girls and 1 in 6 boys is sexually abused before the age of 18 Only 10 of sexual abuse is by strangers half is by family members What can the needy do when abused or neglected by care givers Because care pays poorly Americans don t want to do it We import care givers from poorer countries Nannies from Latin America Nurses come from the Philippines or Jamaica Care is labor intensive Labor become more expensive over time The value of much care activity is the time devoted to it When productivity increases in other areas like car building the opportunity cost in cars of labor time rises This makes care more expensive for a richer society Why doesn t money make us happy Because happiness comes from our social relations our connections with others Money doesn t help our relations with others It may even get in the way Money and markets are about competition undermining friendship Money interferes with our social relations Goods take time crowding out a social life Americans invented quick sex Because we have so many goods to play with we don t have time for each other Talking on the phone while having sex is a bad idea Will we become too rich to care for ourselves We import many care workers nurses and nannies from poorer countries Can we


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