Dr Michael-Burkhard Piorkowsky, Professor for Household and Consumption Economics at the University of Bonn, is one of a number of social scientists who thinks society should recognise the economic value of households, and particularly of unpaid care giving. He told MercatorNet:
Private households are the basic socio-economic units of the economy and society: Firstly, the private household is the most successful institution for providing personal goods which are strongly related to individual needs and small group life, at least cost and in the most satisfying way. The alternative — that is, total provision by institutional households such as like boarding schools, boarding houses, and old people’s homes — is not what people generally want.
Second, the most important function of family households is to bring up children and maintain the latent pattern of society, which includes informal rules, like how to behave in relationships or at the table. In this way the family household produces human capital, starting from very basic and necessary knowledge and competencies. Capital is, after all, only human knowledge impressed upon the material world. The problem of transmission and expansion of knowledge is the crucial problem of any society.
Third, caring for the elderly is mostly done within enlarged family households or in close proximity with support by adult children. Institutional old people’s homes are very cost intensive and not desired by most of the elderly.
In New Zealand, the value of unpaid work has been estimated at $40 billion per year, or 39% of GDP (Statistics NZ figures). About a quarter of this work is caregiving of some kind – so around $10 billion per year.
In principle – and in defiance of the rhetoric of the childfree – I think a good case can be made for paying people who care for relatives. It raises a few issues, though: affordability and accountability for performance are two that come immediately to mind.