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Taxing Childcare: Effects on Childcare Choices, Family Labor Supply and Children

Christina Gathmann () and Björn Sass ()
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Björn Sass: University of Mannheim

No 10813, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: Previous studies report a range of estimates for the response of female labor supply and childcare attendance to childcare prices. We shed new light on these questions using a policy reform that raises the price of public daycare. After the reform, children are 8 percentage points less likely to attend public daycare which implies a compensated price elasticity of -0.6. There is little labor supply response in the full sample, though declines for vulnerable subgroups. Spillover effects on older siblings and fertility decisions show that the policy affects the whole household, not just targeted family members.

Keywords: female labor supply; family policy; childcare; Germany (search for similar items in EconPapers)
JEL-codes: J13 J22 J18 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab
Date: 2017-05
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Forthcoming in Journal of Labor Economics, 2018

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Journal Article: Taxing Childcare: Effects on Childcare Choices, Family Labor Supply, and Children (2018) Downloads
Working Paper: Taxing Childcare: Effects on Childcare Choices, Family Labor Supply and Children (2017) Downloads
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