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Changes in parental leave and young children’s non-cognitive skills

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  • Katrin Huber

    (University of Passau)

Abstract

This study examines the effect of substantial changes in parental leave regulations on the non-cognitive development of children aged between 0 and 3 years. I exploit a large and unanticipated parental leave reform in Germany as a natural experiment. Since the first of January 2007, the replacement of a means-tested by an earnings-related system led to a gain in benefits for wealthier families whereas needier parents receive a lower overall benefit amount than before the reform. I detect a significant negative effect of this change in the parental leave system on the socio-emotional development of newborns and it turns out that children from loser-families drive this effect. The parental leave reform does not have a significant impact on 2–3-year-olds’ skills and development on average and the difference between children from losers and winners does also not persist in the longer run. I only find suggestive evidence that an increase in benefits improves some skills of 2–3-year-olds if compared to those who experience reductions in benefits.

Suggested Citation

  • Katrin Huber, 2019. "Changes in parental leave and young children’s non-cognitive skills," Review of Economics of the Household, Springer, vol. 17(1), pages 89-119, March.
  • Handle: RePEc:kap:reveho:v:17:y:2019:i:1:d:10.1007_s11150-017-9380-2
    DOI: 10.1007/s11150-017-9380-2
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    Cited by:

    1. Huebener, Mathias & Kuehnle, Daniel & Spiess, C. Katharina, 2019. "Parental leave policies and socio-economic gaps in child development: Evidence from a substantial benefit reform using administrative data," Labour Economics, Elsevier, vol. 61(C).

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    More about this item

    Keywords

    Children; Family policy; Parental leave; Non-cognitive skills;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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