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Childcare Availability and Female Labor Force Participation: An Empirical Examination of the Chile Crece Contigo Program

James Manley () and Felipe Vásquez Lavín

No 2013-03, Working Papers from Towson University, Department of Economics

Abstract: Few works have examined the relationship between maternal participation in the labor force and the availability of child care in developing countries. Existing papers also tend to rely on relatively simplistic, correlative analysis of the data rather than modeling the joint decision to invest in formal childcare and to choose a level of labor supply. This paper takes advantage of a policy-induced positive shock in the provision of child care to apply instrumental variables in a simultaneous equations context, resulting in estimates that are more rigorous than any currently available in a developing country context. Policymakers are able to optimize their policy choices if they have better information on the elasticity of labor supply with respect to the cost of child care, and we find no evidence that the program is associated with an increase in women's labor supply.

Keywords: Female Labor Supply; Child Care; Labor Force; Chile; CASEN; JUNJI. (search for similar items in EconPapers)
JEL-codes: J13 J22 O12 H42 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dem, nep-lab, nep-lam, nep-lma and nep-ltv
Date: 2013-12, Revised 2013-12
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