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Care or Cash? The Effect of Child Care Subsidies on Student Performance

  • Black, Sandra

    ()

    (University of Texas, Austin)

  • Devereux, Paul J.

    ()

    (University College Dublin)

  • Løken, Katrine V.

    ()

    (University of Bergen)

  • Salvanes, Kjell G.

    ()

    (Dept. of Economics, Norwegian School of Economics and Business Administration)

Given the wide use of childcare subsidies across countries, it is surprising how little we know about the effect of these subsidies on children’s longer run outcomes. Using a sharp discontinuity in the price of childcare in Norway, we are able to isolate the effects of childcare subsidies on both parental and student outcomes. We find very small and statistically insignificant effects of childcare subsidies on childcare utilization and parental labor force participation. Despite this, we find significant positive effect of the subsidies on children’s academic performance in junior high school, suggesting the positive shock to disposable income provided by the subsidies may be helping to improve children’s scholastic aptitude.

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File URL: http://www.nhh.no/Admin/Public/DWSDownload.aspx?File=%2fFiles%2fFiler%2finstitutter%2fsam%2fDiscussion+papers%2f2012%2f13.pdf
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Paper provided by Department of Economics, Norwegian School of Economics in its series Discussion Paper Series in Economics with number 13/2012.

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Length: 52 pages
Date of creation: 16 May 2012
Date of revision:
Handle: RePEc:hhs:nhheco:2012_013
Contact details of provider: Postal: NHH, Department of Economics, Helleveien 30, N-5045 Bergen, Norway
Phone: +47 55 959 277
Fax: 5595 9100
Web page: http://www.nhh.no/sam/
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  1. John Shea, 1997. "Does Parents' Money Matter?," NBER Working Papers 6026, National Bureau of Economic Research, Inc.
  2. Samuel Berlinski & Sebastian Galiani & Marco Manacorda, 2006. "Giving children a better start: preschool attendance and school-age profiles," IFS Working Papers W06/18, Institute for Fiscal Studies.
  3. David Blau & Erdal Tekin, 2007. "The determinants and consequences of child care subsidies for single mothers in the USA," Journal of Population Economics, Springer, vol. 20(4), pages 719-741, October.
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  11. Tekin, Erdal, 2003. "Child Care Subsidies, Wages, And Employment of Single Mothers," Royal Economic Society Annual Conference 2003 200, Royal Economic Society.
  12. Guido Imbens & Karthik Kalyanaraman, 2010. "Optimal bandwidth choice for the regression discontinuity estimator," CeMMAP working papers CWP05/10, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
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