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Child-care quality and fee structure: Effects on labor supply and leisure composition

  • Brink, Anna

    ()

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

  • Nordblom, Katarina

    ()

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

This paper studies the effects of public child-care subsidies on parental time allocation. We develop a model where parents are allowed to utilize subsidized care during both working and leisure hours. The model distinguishes between subsidies to child-care quality and to fees. Three types of fees are considered: flat, based on time spent in care, and based on parental income. We show that parental time allocation depends on whether quality or fees are subsidized, and also that fee subsidies have di erent e ects depending on the fee structure. We further show that even if a subsidy increases the use of public care, the effect on labor supply may be unclear due to the possibility of using child care also when not working.

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File URL: http://hdl.handle.net/2077/2768
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Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 157.

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Length: 23 pages
Date of creation: 23 Jan 2005
Date of revision:
Handle: RePEc:hhs:gunwpe:0157
Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/

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  1. 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.
  2. Del Boca, Daniela, 2002. "The Effect of Child Care and Part Time Opportunities on Participation and Fertility Decisions in Italy," IZA Discussion Papers 427, Institute for the Study of Labor (IZA).
  3. Ted Bergstrom & Soren Blomquist, 1994. "Political Economy of Subsidized Day Care," Public Economics 9401001, EconWPA.
  4. Lundholm, M. & Ohlsson, H., 1995. "Wages for Women and Publicly Financed Day Care," Papers 1995-23, Uppsala - Working Paper Series.
  5. Theodore C. Bergstrom & S�ren Blomquist, . "The Political Economy of Subsidized Day Care," ELSE working papers 015, ESRC Centre on Economics Learning and Social Evolution.
  6. M. D. R. Evans & Jonathan Kelley, 2002. "Attitudes towards Childcare in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(2), pages 188-196.
  7. David M. Blau, 2000. "Child Care Subsidy Programs," NBER Working Papers 7806, National Bureau of Economic Research, Inc.
  8. Alan Duncan & Gillian Paull & Jayne Taylor, 2001. "Price and quality in the UK childcare market," IFS Working Papers W01/14, Institute for Fiscal Studies.
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