The desire to age "in place" avoiding nursing homes (NHs) seems universally acknowledged, and the recent COVID-19 pandemic may have encouraged it. Using data from the Survey of Health Ageing and Retirement in Europe (SHARE), we show that those living in NH declared a lower level of life satisfaction than those living in the community. Controlling for demographics, the difference was around -8% over an average score of 6.73/10. Adding controls for the economic situation, health, and disability level the negative association becomes nonsignificant. Functional status seems to explain most of the difference in well-being between nursing and private homes. However, the selection into NH may be linked to unobservable characteristics. We tackle this causality issue in two ways. First by using propensity score matching methods. Living in an NH becomes associated with lower well-being. Finally, we make use of our longitudinal data to further reduce the potential impact of nonobservables. The conclusions are globally reversed: living in an NH is associated with higher well-being. This is coherent with a model of optimal residential choices: living in an NH might not be desired but proves to be the best choice for those who make it. This article is part of a Special Collection on Cross-National Gerontology.
Keywords: aging housing choices; care nursing homes; public policy.
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