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Does the cost of child care affect female labor market participation? An evaluation of a French reform of childcare subsidies

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  • Givord, Pauline
  • Marbot, Claire

Abstract

This study evaluates the short-run impact of an increase in childcare subsidies on the use of paid childcare and the participation rate of mothers of preschool children. We use a natural experiment provided by the PAJE, a French reform in family allowances introduced in 2004. This reform temporarily creates discrepancies in the childcare subsidies received by families according to the year of birth of the children. We apply a difference-in-differences strategy on exhaustive French fiscal data that provide information on gross income as well as on the use of paid childcare services between 2005 and 2008. We use the fact that the new policy results in a significant increase in the use of paid childcare services. The effect on the labor force participation of mothers is significant but of a smaller magnitude. The highest impact is observed for mothers of large families.

Suggested Citation

  • Givord, Pauline & Marbot, Claire, 2015. "Does the cost of child care affect female labor market participation? An evaluation of a French reform of childcare subsidies," Labour Economics, Elsevier, vol. 36(C), pages 99-111.
  • Handle: RePEc:eee:labeco:v:36:y:2015:i:c:p:99-111
    DOI: 10.1016/j.labeco.2015.07.003
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    Cited by:

    1. Anna Lovász, 2016. "Childcare expansion and mothers’ employment in post-socialist countries," IZA World of Labor, Institute of Labor Economics (IZA), pages 319-319, December.
    2. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation," Working Papers 811, Queen Mary University of London, School of Economics and Finance.
    3. Claudia Olivetti & Barbara Petrongolo, 2017. "The Economic Consequences of Family Policies: Lessons from a Century of Legislation in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 31(1), pages 205-230, Winter.
    4. Cai, Zhengyu & Stephens, Heather M. & Winters, John V., 2019. "Motherhood, Migration, and Self-Employment of College Graduates," IZA Discussion Papers 12147, Institute of Labor Economics (IZA).
    5. Karolina Goraus & Joanna Tyrowicz & Lucas van der Velde, 2017. "How (Not) to make women work?," GRAPE Working Papers 1, GRAPE Group for Research in Applied Economics.
    6. Thoresen, Thor O. & Vattø, Trine E., 2019. "An up-to-date joint labor supply and child care choice model," European Economic Review, Elsevier, vol. 112(C), pages 51-73.
    7. repec:bla:ecinqu:v:57:y:2019:i:2:p:890-909 is not listed on IDEAS
    8. repec:spr:sjecst:v:154:y:2018:i:1:d:10.1186_s41937-017-0003-x is not listed on IDEAS
    9. Agnes Szabo-Morvai & Anna Lovasz, 2017. "Childcare and Maternal Labor Supply – a Cross-Country Analysis of Quasi-Experimental Estimates from 7 Countries," Budapest Working Papers on the Labour Market 1703, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
    10. Daniela Vuri, 2016. "Do childcare policies increase maternal employment?," IZA World of Labor, Institute of Labor Economics (IZA), pages 241-241, March.
    11. repec:eee:labeco:v:55:y:2018:i:c:p:1-17 is not listed on IDEAS
    12. repec:kap:reveho:v:17:y:2019:i:3:d:10.1007_s11150-019-09442-5 is not listed on IDEAS
    13. María Padilla-Romo & Francisco Cabrera-Hernández, 2018. "The Effect of Children's Time in School on Mothers' Labor Supply: Evidence from Mexico's Full-Time Schools Program," Working Papers 2018-04, University of Tennessee, Department of Economics.
    14. Henning Finseraas & Inés Hardoy & Pål Schøne, 2017. "School enrolment and mothers’ labor supply: evidence from a regression discontinuity approach," Review of Economics of the Household, Springer, vol. 15(2), pages 621-638, June.

    More about this item

    Keywords

    Mother's labor supply; Child care subsidy; Difference-in-differences;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household

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