Evaluation of Long-Term Care Expenditures from the Silver Economy Perspective

Abstract

Silver economics is a field of science that evaluates the long-term care needs that develop because of aging from the economics perspective within the supply and demand framework. The expenditures and investments made to meet long term care needs constitute the main subject of long-term care expenditures. This study empirically tested the relationship between long-term care expenditures and life expectancy. Expenditures on long-term care facilities (LTCFE) were taken as the dependent variable, and life expectancy at birth (LEAB) and life expectancy at 65 years and over (LEO65) were taken as independent variables. The analysis included data from 25 countries with regular LTCFE from 2004 to 2020. The variables were analyzed using the econometric model established within the framework of panel data analysis. According to the least squares analysis results, a 1% increase in LEAB increased LTCFE by 2.1%, while a 1% increase in LEO65 decreased LTCFE by 0.54%. Moreover, a unidirectional causality relationship was found between LTCFE and LEAB and LEO65. The empirical evidence suggests that life expectancy impacted LTCFE. According to the findings, they emphasize the importance of aligning policy frameworks with demographic changes to ensure sustainable long-term care systems in aging societies.