This study examines the heterogenous effects of informal caregiving on caregivers' health and well-being and the mechanisms of the effects, which remain largely undiscussed in previous literature. We used a combined estimation of fixed effects and the instrumental variables to address unobserved time-invariant individual characteristics and the endogeneity problem between caregivers' health and caregiving status. Using data from the four waves of the Japanese Study of Aging and Retirement collected in 2007, 2009, 2011, and 2013, and covering individuals aged 50 to 75 at the baselines, we found robust evidence of the negative effects of informal caregiving on caregivers' mental health and life satisfaction, but not on their physical health. Regarding heterogenous effects, we found that informal caregiving adversely affected female but not male caregivers' mental health and life satisfaction. Our results also showed that informal caregiving had greater effects on individuals providing care for their mothers-in-law, with a higher socioeconomic status, living with their in-laws, and belonging to younger groups. Our results indicated that the loss of social networks and leisure and social activities were channels through which informal caregiving might negatively affect caregivers’ health and well-being. This study provides suggestions that policy makers may use to mitigate the negative effects of caregiving with targeted interventions, while formulating policies to support informal caregivers.
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