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Reassessing the Role of Child Care Costs in the Work and Care Decisions of Australian Families

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Author Info
Deborah Cobb-Clark
Amy Liu
Deborah Mitchell

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Abstract

This paper reassesses how the costs associated with child care influence Australian families’ decisions about their work and child care arrangements. Using data from the Negotiating the Life Course Survey, we suggest that the cost of care may not be an important barrier to labour market participation. Non-employed mothers do not cite child care as the barrier preventing them from working and many two-earner families appear to be able to adjust their schedules so as to avoid paying child care costs at all. Instead, factors such as the cost structures associated with formal, informal and parental care; attitudes regarding work and child rearing; and the work arrangements of working couples to be more important in the labour-supply decision. In addition, the data suggests there are important differences in the cost structure of different types of care. While costs in formal care appear to be fixed, informal and parental care has a larger variable cost component. Results indicate that the relative importance of fixed costs influence the decision about which type of child care arrangement is utilised.

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Publisher Info
Paper provided by Centre for Economic Policy Research, Research School of Social Sciences, Australian National University in its series CEPR Discussion Papers with number 409.

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Length: 24 pages
Date of creation: Aug 1999
Date of revision:
Handle: RePEc:auu:dpaper:409

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Web page: http://econrsss.anu.edu.au/
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Find related papers by JEL classification:
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

References listed on IDEAS
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  1. Deborah Schofield & Josh Polette, 1998. "Measuring the Impact of Child Care Subsidies on the Incomes of Mothers Returning to Work," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 31(1), pages 47-62. [Downloadable!] (restricted)
  2. Ribar, David C, 1995. "A Structural Model of Child Care and the Labor Supply of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 13(3), pages 558-97, July. [Downloadable!] (restricted)
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  3. Francis Teal, 1992. "The Use and Cost of Child Care in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 25(1), pages 3-14. [Downloadable!] (restricted)
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  4. Connelly, Rachel, 1992. "The Effect of Child Care Costs on Married Women's Labor Force Participation," The Review of Economics and Statistics, MIT Press, vol. 74(1), pages 83-90, February. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Daniela Del Boca & Daniela Vuri, 2006. "The Mismatch between Employment and Child Care in Italy: the Impact of Rationing," CHILD Working Papers wp08_06, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY. [Downloadable!]
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  2. Daniela Del Boca & Daniela Vuri, 2005. "Labor Supply and Child Care Costs: The Effect of Rationing," Labor and Demography 0510016, EconWPA. [Downloadable!]
    Other versions:
  3. Anu Rammohan & Stephen Whelan, 2006. "Child Care Costs and the Employment Status of Married Australian Mothers," CEPR Discussion Papers 517, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
  4. Denise Doiron & Guyonne Kalb, 2004. "Demands for Childcare and Household Labour Supply in Australia," Melbourne Institute Working Paper Series wp2004n06, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
    Other versions:
  5. Guyonne Kalb, 2007. "Children, Labour Supply and Childcare: Challenges for Empirical Analysis," Melbourne Institute Working Paper Series wp2007n15, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne. [Downloadable!]
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