The Supply Of Quality In Child Care Centers

David Blau and Naci Mocan

The Review of Economics and Statistics, 2002, vol. 84, issue 3, 483-496

Abstract: We use data from a sample of child care centers to estimate the relationships between cost and child care quality, and between revenue and quality. We use a measure of child care quality, designed by developmental psychologists, that is positively associated with child development. Taking the estimated cost-quality and revenue-quality relationships as given, we estimate the objective functions of firms and compute the quality supply function. The results indicate that the supply of quality is moderately elastic with respect to price and the wages of child care center workers. Implications of the results for child care policy are discussed. © 2002 by the President and Fellows of Harvard College and the Massachusetts Institute of Technolog

Date: 2002
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Working Paper: The Supply of Quality in Child Care Centers (1999)
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