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The Rug Rat Race

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  • Garey Ramey
  • Valerie A. Ramey

Abstract

After three decades of decline, the amount of time spent by parents on childcare in the U.S. began to rise dramatically in the mid-1990s. Moreover, the rise in childcare time was particularly pronounced among college-educated parents. Why would highly educated parents increase the amount of time they allocate to childcare at the same time that their own market returns have skyrocketed? After finding no empirical support for standard explanations, such as selection or income effects, we offer a new explanation. We argue that increased competition for college admissions may be an important source of these trends. The number of college-bound students has surged in recent years, coincident with the rise in time spent on childcare. The resulting "cohort crowding" has led parents to compete more aggressively for college slots by spending increasing amounts of time on college preparation. Our theoretical model shows that, since college-educated parents have a comparative advantage in college preparation, rivalry leads them to increase preparation time by a greater amount than less-educated parents. We provide empirical support for our explanation with a comparison of trends between the U.S. and Canada, and a comparison across racial groups in the U.S.

Suggested Citation

  • Garey Ramey & Valerie A. Ramey, 2009. "The Rug Rat Race," NBER Working Papers 15284, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:15284
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    Cited by:

    1. Christian Siegel, 2017. "Female Relative Wages, Household Specialization and Fertility," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 24, pages 152-174, March.
    2. Gobbi, Paula E., 2018. "Childcare and commitment within households," Journal of Economic Theory, Elsevier, vol. 176(C), pages 503-551.
    3. Yum, Minchul, 2016. "Parental time investment and intergenerational mobility," Working Papers 16-06, University of Mannheim, Department of Economics.
    4. Goodman, Joshua Samuel & Goodman, Lucas & Goodman, Sarena & Goodman, Allen C., 2014. "A Few Goodmen: Surname-Sharing Co-Authors in Economics," Scholarly Articles 22805379, Harvard University Department of Economics.
    5. Seung-Eun Cha & Yoo-Jean Song, 2017. "Time or Money: The Relationship Between Educational Attainment, Income Contribution, and Time with Children Among Korean Fathers," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 134(1), pages 195-218, October.
    6. Aguiar, M. & Hurst, E., 2016. "The Macroeconomics of Time Allocation," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 203-253, Elsevier.
    7. Gimenez-Nadal, Jose Ignacio & Sevilla, Almudena, 2016. "Intensive Mothering and Well-being: The Role of Education and Child Care Activity," MPRA Paper 74249, University Library of Munich, Germany.
    8. Jonathan Guryan & Erik Hurst & Melissa Kearney, 2008. "Parental Education and Parental Time with Children," Journal of Economic Perspectives, American Economic Association, vol. 22(3), pages 23-46, Summer.
    9. Zhu, Guozhong & Vural, Gulfer, 2013. "Inter-generational effect of parental time and its policy implications," Journal of Economic Dynamics and Control, Elsevier, vol. 37(9), pages 1833-1851.
    10. Christopher L. Smith, 2011. "Polarization, immigration, education: What's behind the dramatic decline in youth employment?," Finance and Economics Discussion Series 2011-41, Board of Governors of the Federal Reserve System (U.S.).
    11. Robert A. Moffitt, 2012. "The Reveral of the Employment-Population Ratio in the 2000s: Facts and Explanations," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 43(2 (Fall)), pages 201-264.
    12. Christian Siegel, 2012. "Female Employment and Fertility - The Effects of Rising Female Wages," CEP Discussion Papers dp1156, Centre for Economic Performance, LSE.
    13. Gábor Kertesi & Gábor Kézdi, 2016. "On the test score gap between Roma and non-Roma students in Hungary and its potential causes," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 24(1), pages 135-162, January.
    14. C. Fan & Jie Zhang, 2013. "Differential fertility and intergenerational mobility under private versus public education," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(3), pages 907-941, July.
    15. Ed Hopkins, 2012. "Job Market Signaling Of Relative Position, Or Becker Married To Spence," Journal of the European Economic Association, European Economic Association, vol. 10(2), pages 290-322, April.
    16. Paula GOBBI, 2013. "Childcare and Commitment within Households," LIDAM Discussion Papers IRES 2013019, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    17. Francine D. Blau & Anne E. Winkler, 2017. "Women, Work, and Family," NBER Working Papers 23644, National Bureau of Economic Research, Inc.
    18. Minagawa, Junichi & Upmann, Thorsten, 2013. "A note on parental time allocation," Labour Economics, Elsevier, vol. 25(C), pages 153-157.
    19. Bruins, Marianne, 2017. "Women's economic opportunities and the intra-household production of child human capital," Labour Economics, Elsevier, vol. 44(C), pages 122-132.
    20. Kertesi, Gábor & Kézdi, Gábor, 2012. "A roma és nem roma tanulók teszteredményei közti különbségekről és e különbségek okairól [The Roma/non-Roma test-score gap in Hungarian education]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 798-853.
    21. Minchul Yum, 2015. "Parental Time Investment and Human Capital Formation: A Quantitative Analysis of Intergenerational Mobility," 2015 Meeting Papers 996, Society for Economic Dynamics.

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    More about this item

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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