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Universal Childcare, Maternal Labor Supply, and Family Well-Being

  • Michael Baker

    ()

  • Jonathan Gruber

    ()

  • Kevin Milligan

    ()

The growing labour force participation of women with small children in both the U.S. and Canada has led to calls for increased public financing for childcare. The optimality of public financing depends on a host of factors, such as the “crowd-out†of existing childcare arrangements, the impact on female labor supply, and the effects on child well-being. The introduction of universal, highlysubsidized childcare in Quebec in the late 1990s provides an opportunity to address these issues. This paper carefully analyzes the impacts of Quebec’s “$5 per day childcare†programme on childcare utilization,labor supply, and child (and parent) outcomes in two parent families. The authors find strong evidence of a shift into new childcare use, although approximately one third of the newly reported use appears to come from women who previously worked and had informal arrangements. The labour supply impact is highly significant, and the measured elasticity of 0.236 is slightly smaller than previous credible estimates. Finally, the authors uncover striking evidence that children are worse off in a variety of behavioral and health dimensions, ranging from aggression to motor-social skills to illness. This analysis also suggests that the new childcare programme led to more hostile, less consistent parenting, worse parental health, and lower-quality parental relationships.

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Paper provided by eSocialSciences in its series Working Papers with number id:547.

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Date of creation: Jun 2006
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Handle: RePEc:ess:wpaper:id:547
Note: Institutional Papers
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  1. 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.
  2. Francine D. Blau & Adam J. Grossberg, 1990. "Maternal Labor Supply and Children's Cognitive Development," NBER Working Papers 3536, National Bureau of Economic Research, Inc.
  3. Ruhm, Christopher J., 2008. "Maternal employment and adolescent development," Labour Economics, Elsevier, vol. 15(5), pages 958-983, October.
  4. Jonah B. Gelbach, 2002. "Public Schooling for Young Children and Maternal Labor Supply," American Economic Review, American Economic Association, vol. 92(1), pages 307-322, March.
  5. Thomas, D. & Currie, J., 1993. "Does Head Start Make a Difference?," Papers 694, Yale - Economic Growth Center.
  6. Karen Norberg, 1998. "The Effects of Daycare Reconsidered," NBER Working Papers 6769, National Bureau of Economic Research, Inc.
  7. David M. Blau & Alison P. Hagy, 1998. "The Demand for Quality in Child Care," Journal of Political Economy, University of Chicago Press, vol. 106(1), pages 104-146, February.
  8. Christopher J. Ruhm, 2004. "Parental Employment and Child Cognitive Development," Journal of Human Resources, University of Wisconsin Press, vol. 39(1).
  9. David M. Blau, 2000. "Child Care Subsidy Programs," NBER Working Papers 7806, National Bureau of Economic Research, Inc.
  10. Arleen Leibowitz, 1977. "Parental Inputs and Children's Achievement," Journal of Human Resources, University of Wisconsin Press, vol. 12(2), pages 242-251.
  11. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-in-Differences Estimates?," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 249-275, February.
  12. Charles Michalopoulos & Philip K. Robins & Irwin Garfinkel, 1992. "A Structural Model of Labor Supply and Child Care Demand," Journal of Human Resources, University of Wisconsin Press, vol. 27(1), pages 166-203.
  13. Gordon Cleveland & Morley Gunderson & Douglas Hyatt, 1996. "Child Care Costs and the Employment Decision of Women: Canadian Evidence," Canadian Journal of Economics, Canadian Economics Association, vol. 29(1), pages 132-51, February.
  14. Kevin Milligan & Mark Stabile, 2004. "The Integration of Child Tax Credits and Welfare: Evidence from the National Child Benefit Program," NBER Working Papers 10968, National Bureau of Economic Research, Inc.
  15. 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," Cahiers de recherche 0508, CIRPEE.
  16. James J. Heckrnan, 1974. "Effects of Child-Care Programs on Women's Work Effort," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 491-524 National Bureau of Economic Research, Inc.
  17. Patricia M. Anderson & Philip B. Levine, 1999. "Child Care and Mothers' Employment Decisions," NBER Working Papers 7058, National Bureau of Economic Research, Inc.
  18. Parsons, Donald O, 1991. "The Health and Earnings of Rejected Disability Insurance Applicants: Comment," American Economic Review, American Economic Association, vol. 81(5), pages 1419-26, December.
  19. Killingsworth, Mark R. & Heckman, James J., 1987. "Female labor supply: A survey," Handbook of Labor Economics, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 2, pages 103-204 Elsevier.
  20. repec:rus:hseeco:9882 is not listed on IDEAS
  21. Charles Michalopoulos & Philip K. Robins, 2000. "Employment and child-care choices in Canada and the United States," Canadian Journal of Economics, Canadian Economics Association, vol. 33(2), pages 435-470, May.
  22. Stafford, Frank P, 1987. "Women's Work, Sibling Competition, and Children's School Performance," American Economic Review, American Economic Association, vol. 77(5), pages 972-80, December.
  23. Lisa M. Powell, 2002. "Joint Labor Supply and Childcare Choice Decisions of Married Mothers," Journal of Human Resources, University of Wisconsin Press, vol. 37(1), pages 106-128.
  24. Pierre Lefebvre & Philip Merrigan, 2000. "The Effect of Childcare and Early Education Arrangements on Developmental Outcomes of Young Children," Cahiers de recherche CREFE / CREFE Working Papers 119, CREFE, Université du Québec à Montréal.
  25. Kevin Milligan, 2002. "Subsidizing the Stork: New Evidence on Tax Incentives and Fertility," NBER Working Papers 8845, National Bureau of Economic Research, Inc.
  26. Rachel Connelly & Jean Kimmel, 2003. "Marital status and full-time/part-time work status in child care choices," Applied Economics, Taylor & Francis Journals, vol. 35(7), pages 761-777.
  27. Berger, Mark C & Black, Dan A, 1992. "Child Care Subsidies, Quality of Care, and the Labor Supply of Low-Income, Single Mothers," The Review of Economics and Statistics, MIT Press, vol. 74(4), pages 635-42, November.
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