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Female employment and pre-kindergarten: on the uninteded effects of an Italian reform

Author

Listed:
  • Francesca Carta

    (Bank of Italy)

  • Lucia Rizzica

    (Bank of Italy)

Abstract

We theoretically show that when mothers need to buy childcare services not only if they work but also if they want to search actively for a job, a reduction in the price of childcare will increase their likelihood of searching but may decrease their willingness to accept a job offer and therefore lower employment. We test these predictions empirically by means of a Regression Discontinuity design and find that the introduction in Italy of pre-kindergarten, a much cheaper alternative to day care for 2-year-old children, increased both participation in the labour market and employment of mothers of eligible children. This effect was driven largely by a significant decrease in the stated reservation wage.

Suggested Citation

  • Francesca Carta & Lucia Rizzica, 2015. "Female employment and pre-kindergarten: on the uninteded effects of an Italian reform," Temi di discussione (Economic working papers) 1030, Bank of Italy, Economic Research and International Relations Area.
    • Handle: RePEc:bdi:wptemi:td_1030_15
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    File URL: http://www.bancaditalia.it/pubblicazioni/temi-discussione/2015/2015-1030/en_tema_1030.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    childcare; female labour supply; public services;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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