Economic Valuation of Informal Care Systems

Informal care systems encompass the unpaid support provided by family members, friends and community volunteers to individuals with health or social care needs. As populations age and the prevalence of chronic conditions rises, the scale and economic significance of informal care have become central to debates on sustainable health‐care financing. Economic valuation seeks to render visible the full cost of caregiving by assigning a monetary equivalent to carers’ time, forgone earnings and personal sacrifices. Methodologies span replacement cost estimates, which value informal care at market rates for equivalent professional services; opportunity cost approaches, which calculate the income carers forego; and contingent valuation techniques, which elicit carers’ willingness to pay or accept compensation for changes in their caregiving load. Across diverse settings, these methods reveal that informal care often represents a substantial share of national output—typically between 1 % and 4 % of GDP. By quantifying hidden resources, economic valuation informs long‐term care policy, resource allocation and the design of supportive measures such as respite services, cash benefits and skills training. Emerging research highlights methodological challenges in standardising valuations, capturing heterogeneity in care intensity and integrating informal care costs into formal cost‐effectiveness analyses. Such insights are critical for governments and health systems seeking to balance the roles of formal providers and informal networks in future models of integrated care.

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Economic Valuation of Informal Care Systems publication trend

The graph below shows the total number of articles in economic valuation of informal care systems across all publications each year (not limited to Nature Index journals).

Technical terms

Informal care: Unpaid assistance provided by non‐professional caregivers to individuals with health or social needs.

Replacement cost method: Valuation of informal care by assigning the hourly rate of equivalent professional services.

Opportunity cost approach: Estimation of informal care value based on carers’ forgone wages or leisure opportunities.

Proxy good method: Technique that uses the market wage of a substitute provider to value carers’ time inputs.

Contingent valuation method: Survey‐based approach eliciting carers’ willingness to pay or accept for changes in caregiving hours.

References

1. Making visible the cost of informal caregivers’ time in Latin America: a case study for major cardiovascular, cancer and respiratory diseases in eight countries. BMC Public Health (2023).
2. Expenditure projections for community home-based care services for older adults with functional decline in China. International Journal for Equity in Health (2023).
3. The Economic Value of Non-professional Care: A Europe-Wide Analysis. International Journal of Health Policy and Management (2021).