User Choice in Elderly Care in Sweden: Quality, Cost, and Covid-19

Abstract: This thesis investigates the impacts of user choice in Swedish elderly care on quality and cost as well as the impact of marketisation on the Covid-19 death toll. In the last three decades welfare service provision in Sweden has been increasingly marketised. Since 2009, Swedish municipalities have been able to introduce user choice in elderly care and it has been widely adopted in home care. To investigate the impact of introducing user choice, new insights from econometrics literature is used to estimate a staggered Difference-in-Difference model, using panel data for the years 2003-2019 and the 290 Swedish municipalities. The impact of marketisation on the Covid-19 death toll is estimated through Ordinary Least Squares using a cross-sectional data set. There are three main findings of this thesis. (i) The impact on quality and cost of the introduction of user choice has had heterogeneous effects across adoption groups, calendar time, and exposure length of treatment, and hence, the standard Difference- in-Difference approach is likely to provide biased estimates in this setting. (ii) The introduction of user choice has no clear effect on non-contractible quality measured by mortality rate and fall accidents, nor on cost. However, user choice has increased subjective quality, as measured by user satisfaction. (iii) A higher degree of marketisation in home care is associated with a higher Covid-19 death toll amongst those which had home care.