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Parental Leave, (In)formal Childcare and Long-term Child Outcomes

Author

Listed:
  • Danzer, Natalia

    () (Ifo Institute for Economic Research)

  • Halla, Martin

    () (University of Linz)

  • Schneeweis, Nicole

    () (University of Linz)

  • Zweimüller, Martina

    () (University of Linz)

Abstract

We provide a novel interpretation of the estimated treatment effects from evaluations of parental leave reforms. Accounting for the counterfactual mode of care is crucial in the analysis of child outcomes and potential mediators. We evaluate a large and generous parental leave extension in Austria exploiting a sharp birthday cutoff-based discontinuity in the eligibility for extended parental leave and geographical variation in formal childcare. We find that estimated treatment effects on long-term child outcomes differ substantially according to the availability of formal childcare and the mother's counterfactual work behavior. We show that extending parental leave has significant positive effects on children's health and human capital outcomes only if the reform induces a replacement of informal childcare with maternal care. We conclude that care provided by mothers (or formal institutions) is superior to informal care-arrangements.

Suggested Citation

  • Danzer, Natalia & Halla, Martin & Schneeweis, Nicole & Zweimüller, Martina, 2017. "Parental Leave, (In)formal Childcare and Long-term Child Outcomes," IZA Discussion Papers 10812, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10812
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    References listed on IDEAS

    as
    1. Nicole Schneeweis & Martina Zweimüller, 2014. "Early Tracking and the Misfortune of Being Young," Scandinavian Journal of Economics, Wiley Blackwell, vol. 116(2), pages 394-428, April.
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    6. Michael J. Kottelenberg & Steven F. Lehrer, 2017. "Targeted or Universal Coverage? Assessing Heterogeneity in the Effects of Universal Child Care," Journal of Labor Economics, University of Chicago Press, vol. 35(3), pages 609-653.
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    More about this item

    Keywords

    maternal labor supply; child development; informal childcare; formal childcare; parental leave; fertility;

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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