Caring for informal caregivers: policy approaches to the provision of direct support services

Despite being the backbone of modern welfare states, the informal care sector for elderly people in need of long-term care is highly dysfunctional. The majority of informal caregivers are overburdened on account of their care-related activities, although an evolving market for support services directly aimed at relieving informal caregivers is observable. In this paper, we examine the reasons for the imperfect exchange between demand and supply in this market, applying the economic theory of market failure. Through a case study of Austria based on an empirical, qualitative survey of all direct support services and their suppliers on the national level as well as in three provinces, an understanding of this market's main players and mechanisms is derived. Thus, the authors determine that three different system types can be identified beyond the historical regional discrepancies. They illustrate the approaches to service provision for informal caregivers: centralized and public, laissez-faire and private, and a radically decentralized network for informal caregivers. Still, lack of information, social and psychological barriers, as well as high transaction costs, are identified which undermine the support service market for informal care. If the costs of the formal long-term care sector are to be contained despite demographic developments, better policy approaches will be necessary to overcome this challenge. In light of this, recommendations are derived to ensure a better exchange between supply and demand. By providing an initial empirical understanding and analysis of this market and its imperfections, the authors pioneer future quantitative research in this field.