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Life-Cycle Effects of Public Childcare: Evidence on Children and Their Parents

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  • Mikko Silliman
  • Juuso Mäkinen

Abstract

This paper provides large-scale evidence linking the economic effects of childcare programs to social skills measured in adulthood. We examine Finland's first national public childcare program, and document that it increased parental labor supply - through retirement - while reducing the intergenerational persistence of income. Critically, we leverage Finnish Defence Forces data on the near population of males to show that effects on children's adult income are underlied by lasting effects on social skills. Further, we show that life-cycle cost-effectiveness estimates based on the assumption of constant effects after typical observation windows can considerably overestimate the net costs of public childcare.

Suggested Citation

  • Mikko Silliman & Juuso Mäkinen, 2026. "Life-Cycle Effects of Public Childcare: Evidence on Children and Their Parents," CESifo Working Paper Series 12372, CESifo.
    • Handle: RePEc:ces:ceswps:_12372
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    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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