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Labor Supply and Child Care Choices in a Rationed Child Care Market

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Author Info
Katharina Wrohlich () (DIW Berlin and IZA Bonn)

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Abstract

In this paper, I suggest an empirical framework for the analysis of mothers' labor supply and child care choices, explicitly taking into account access restrictions to subsidized child care. This is particularly important for countries such as Germany, where subsidized child care is rationed and private child care is only available at considerably higher cost. I use a discrete choice panel data model controlling for unobserved heterogeneity to simultaneously estimate labor supply and the demand for child care of German mothers with at least one child under the age of seven years. The model can be used to evaluate different kinds of policy reforms, such as changes in the availability or costs of child care. Results from the illustrating policy simulations show that targeting public expenditures at an extension of child care slots has greater effects on the demand for child care as well as on maternal employment than a reduction of parents' fees to existing slots.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2053.

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Length: 31 pages
Date of creation: Mar 2006
Date of revision:
Handle: RePEc:iza:izadps:dp2053

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Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
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Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
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Related research
Keywords: child care labor supply discrete choice panel study Germany

Other versions of this item:

Find related papers by JEL classification:
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models

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References listed on IDEAS
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. Miriam Beblo & Charlotte Lauer & Katharina Wrohlich, 2005. "Ganztagsschulen und Erwerbsbeteiligung von Müttern : eine Mikrosimulationsstudie für Deutschland," Discussion Papers of DIW Berlin 543, DIW Berlin, German Institute for Economic Research. [Downloadable!]
    Other versions:
  2. Viktor Steiner & Katharina Wrohlich, 2004. "Household Taxation, Income Splitting and Labor Supply Incentives : A Microsimulation Study for Germany," Discussion Papers of DIW Berlin 421, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  3. Blau, David M & Robins, Philip K, 1988. "Child-Care Costs and Family Labor Supply," The Review of Economics and Statistics, MIT Press, vol. 70(3), pages 374-81, August. [Downloadable!] (restricted)
  4. repec:rus:hseeco:9882 is not listed on IDEAS
  5. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March. [Downloadable!] (restricted)
  6. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January. [Downloadable!] (restricted)
  7. Wrohlich, Katharina, 2005. "The Excess Demand for Subsidized Child Care in Germany," IZA Discussion Papers 1515, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  8. Lokshin, Michael M., 1999. "Household childcare choices and women's work behavior in Russia," Policy Research Working Paper Series 2206, The World Bank. [Downloadable!]
  9. Heckman, James J, 1974. "Effects of Child-Care Programs on Women's Work Effort," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages S136-S163, Part II, . [Downloadable!] (restricted)
  10. Daniela Del Boca & Daniela Vuri, 2005. "Labor Supply and Child Care Costs: The Effect of Rationing," Labor and Demography 0510016, EconWPA. [Downloadable!]
    Other versions:
  11. Alan Duncan & Gillian Paull & Jayne Taylor, 2001. "Mothers' employment and the use of childcare in the UK," IFS Working Papers W01/23, Institute for Fiscal Studies. [Downloadable!]
  12. 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)
    Other versions:
  13. David M. Blau & Alison P. Hagy, 1998. "The Demand for Quality in Child Care," Journal of Political Economy, University of Chicago Press, vol. 106(1), pages 104-146, February. [Downloadable!] (restricted)
  14. Del Boca, Daniela & Locatelli, Marilena & Vuri, Daniela, 2004. "Child Care Choices by Italian Households," IZA Discussion Papers 983, Institute for the Study of Labor (IZA). [Downloadable!]
  15. Philippe Chone & David le Blanc & Isabelle Robert-Bobee, 2003. "Female Labor Supply and Child Care in France," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
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