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Labour supply effects of a cash-for-care subsidy

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  • Pål Schøne

Abstract

From 1999, all parents in Norway with children aged one to three, who did not attend publicly subsidised daycare, became eligible for a cash-for-care (CFC) subsidy. One effect of the CFC-subsidy was to increase in the relative price of external child care. This article analyses whether the CFC-subsidy has led to a reduction in the labour supply of mothers. A framework for evaluating policy reforms when reforms are equally and nation-wide accessible is put forward. The results show that the CFC-subsidy has reduced women’s labour supply. The results are sustained after controlling for contemporaneous macroeconomic shocks, using a triple difference approach. Copyright Springer-Verlag 2004

Suggested Citation

  • Pål Schøne, 2004. "Labour supply effects of a cash-for-care subsidy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 17(4), pages 703-727, December.
  • Handle: RePEc:spr:jopoec:v:17:y:2004:i:4:p:703-727
    DOI: 10.1007/s00148-003-0176-8
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    More about this item

    Keywords

    J13; J18; J22; Labour supply; child care; difference-in-differences-in-differences;
    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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