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The Québec's Experiment of $5 per Day per Child Childcare Policy and Mother's Labour Supply: Evidence Based on the Five Cycles of the NLSCY

Listed author(s):
  • Pierre Lefebvre
  • Philip Merrigan

On September 1st, 1997, a new childcare policy was initiated by the provincial government of Quebec, the second most populous province in Canada. Childcare services licensed by the Ministry of the Family (not-for-profit centres, family-based childcare, and for-profit centres under the agreement) began offering day care spaces at the reduced parental contribution of $5 per day per child for children aged 4 years. In successive years, the government reduced the age requirement and engaged in a plan to create new childcare facilities and pay for the cost of additional $5 per day childcare spaces. By September 2000, the low-fee policy applied to all children aged 0 to 59 months (not in kindergarten) and the number of partly subsidized spaces increased from 77,000 in 1998 to 163,000 spaces, totally subsidized by the end of year 2002, while the number of eligible children, zero to four years old, declined from 428,000 to 369,000 over the same period. Using data drawn from Statistics Canada's National Longitudinal Survey of Children and Youth (NLSCY), this study attempts to estimate the effect of the policy on the labour supply behavior of Quebec mothers with pre-school children, aged from 0 to 5 years old. The analysis examines the impact of the policy on the following outcomes: labour force participation and annual number of weeks at work. A non-experimental evaluation framework based on multiple pre- and post-treatment periods is used to estimate the effect of the childcare regime. The econometric results support the hypothesis that the childcare policy, together with the transformation of public kindergarten from a part-time to a full-time basis, had a large and statistically significant impact on the labour supply of Quebec's mothers with pre-school children. The estimates also suggest, though less convincingly, that the size of the impact increased concurrently with the positive growth in the number of low-fee spaces. Le 1er septembre 1997, le gouvernement du Québec instaurait une nouvelle politique de subvention aux services de garde. Les milieux de garde reconnus par le ministère de la Famille et de l'Enfance ont commencé à offrir des places à contribution réduite (5 $/jour) pour les enfants qui avaient atteint l'âge de 4 ans au 30 septembre. En outre, le gouvernement s'engageait à réduire progressivement (chaque année) l'âge d'admissibilité de ces places et à augmenter leur nombre dans le réseau des services de garde subventionnés. En septembre 2000, la politique s'est appliquée à tous les enfants âgés de 0 à 59 mois (non en maternelle) et le nombre de places partiellement subventionnées est passé de 77 000 en 1998 à 163 000 à la fin de 2002, alors que le nombre d'enfants âgés de 0 à 4 ans a baissé de 428 000 à 369 000 sur la même période. Cette étude, qui s'appuie sur les données de l'Enquête nationale longitudinale sur les enfants et les jeunes, conduite par Statistique Canada, estime les effets de la politique sur l'offre de travail des mères québécoises qui ont au moins un enfant âgé entre 0 et 5 ans. Deux indicateurs du comportement de travail sont analysés, soit la participation au marché du travail et le nombre annuel de semaines travaillées. L'analyse adopte une approche « quasi expérimentale », c'est-à-dire que les différences entre les mères québécoises (groupe traitement) et les mères des autres provinces (groupe de contrôle) sont comparées avant et après la mise en place du régime de subventions aux services de garde. Nos résultats sont conformes à l'hypothèse que le programme de soutien aux services de garde mis en place par le gouvernement du Québec, simultanément avec la maternelle cinq ans gratuite et à temps plein, ont eu un impact important et statistiquement significatif sur l'offre de travail des mères avec des enfants de 5 ans ou moins. Les résultats économétriques soutiennent aussi, quoique de façon moins convaincante, que l'ampleur de l'effet a augmenté simultanément avec l'augmentation du nombre de places à contribution réduite de 1998 à 2002.

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Paper provided by CIRANO in its series CIRANO Project Reports with number 2005rp-21.

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Length: 43 pages
Date of creation: 01 Oct 2005
Handle: RePEc:cir:cirpro:2005rp-21
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  1. Francesconi, Marco & van der Klaauw, Wilbert, 2004. "The consequences of 'in-work' benefit reform in Britain: new evidence from panel data," ISER Working Paper Series 2004-13, Institute for Social and Economic Research.
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  3. Ribar, David C, 1995. "A Structural Model of Child Care and the Labor Supply of Married Women," Journal of Labor Economics, University of Chicago Press, vol. 13(3), pages 558-597, July.
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  8. James J. Heckman, 1974. "Effects of Child-Care Programs on Women's Work Effort," NBER Chapters,in: Marriage, Family, Human Capital, and Fertility, pages 136-169 National Bureau of Economic Research, Inc.
  9. Pierre Lefebvre & Philip Merrigan, 2005. "Low-fee ($5/day/child) Regulated Childcare Policy and the Labor Supply of Mothers with Young Children: A Natural Experiment from Canada," CIRANO Working Papers 2005s-09, CIRANO.
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  16. Blau, David & Currie, Janet, 2006. "Pre-School, Day Care, and After-School Care: Who's Minding the Kids?," Handbook of the Economics of Education, Elsevier.
  17. 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.
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