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Money for nothing? Universal child care and maternal employment

Tarjei Havnes and Magne Mogstad ()

Journal of Public Economics, 2011, vol. 95, issue 11, 1455-1465

Abstract: The strong correlation between child care and maternal employment rates has led previous research to conclude that affordable and readily available child care is a driving force both of cross-country differences in maternal employment and of its rapid growth over the last decades. We analyze a staged expansion of subsidized child care in Norway. Our precise and robust difference-in-differences estimates reveal that there is little, if any, causal effect of subsidized child care on maternal employment, despite a strong correlation. Instead of increasing mothers' labor supply, the new subsidized child care mostly crowds out informal child care arrangements, suggesting a significant net cost of the child care subsidies.

Keywords: Universal child care; Child care subsidies; Maternal employment (search for similar items in EconPapers)
JEL-codes: J13 H40 J21 (search for similar items in EconPapers)
Date: 2011
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Working Paper: Money for Nothing? Universal Child Care and Maternal Employment (2009) Downloads
Working Paper: Money for Nothing? Universal Child Care and Maternal Employment (2009) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:95:y:2011:i:11:p:1455-1465

DOI: 10.1016/j.jpubeco.2011.05.016

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