Regulating Child Care: The Effects of State Regulations on child Care Demand and Its Cost

V. Joseph Hotz and M. Rebecca Kilbourn

No 9405, Working Papers from Harris School of Public Policy Studies, University of Chicago

Abstract: In this paper, we examine the effects of existing state-level child care regulations on the cost, or price, of non-parental child care, the demand for (non-parental) child care by parents, and the mother's decision to enter the labor force. We distinguish between the indirect effects of regulations on demand via their effect on the cost of such care facing parents as well and the direct (and non-price) effects regulations may have by imposing standards in the form of minimum levels of quality on available care facing parents. In our empirical analysis, we analyze the child care decisions of all parents with preschool age children, including households with working and non-working mothers, using child care data from the 1986 wave of the National Longitudinal Survey of the High School Class of 1972 (NLS72). We present estimates of the effects of two sets of regulations--namely, restrictions on child-to-staff ratios in day care centers and educational and/or training requirements of workers in either centers or home day care setting – as well as two types of child care subsidies – child care tax credit for working mothers and subsidies to providers – on the child care and maternal work decisions of households as well as on the hourly cost of child care. Our evidence indicates that state regulations both increase the cost of child care as well as have direct (non-price) effects on utilization but that their total effect tends to reduce the utilization of market-based child care, especially among households with non-working mothers. Since economically disadvantaged and black women are disproportionately represented in the latter group, it appears that one of the consequences of regulations are to defer the utilization of child care by households with children for whom the purported developmental benefits of organized day care might be most beneficial.

Keywords: child care; state regulation; child care cost; working mothers; working parents (search for similar items in EconPapers)
Date: 1994-10
References: Add references at CitEc
Citations:

Downloads: (external link)
http://harrisschool.uchicago.edu/about/publication ... ers/pdf/wp_94_05.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to harrisschool.uchicago.edu:80 (nodename nor servname provided, or not known)

Related works:
Working Paper: Regulating Child Care: The Effects of State Regulations on Child Care Demand and Its Cost
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:har:wpaper:9405

Access Statistics for this paper

More papers in Working Papers from Harris School of Public Policy Studies, University of Chicago Contact information at EDIRC.
Bibliographic data for series maintained by Eleanor Cartelli ( this e-mail address is bad, please contact ).