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Effects of Childcare Subsidies on Employment and Earnings of Low-Income Mothers

Author

Listed:
  • Zanoni Wladimir

    (Chapin Hall at the University of Chicago, 1313 E 60th Street, Chicago, IL 60637, USA)

  • Weinberger Gabriel

    (Pardee RAND Graduate School, 1776 Main St, Santa Monica, CA 90401, USA)

Abstract

This study examines how childcare subsidies funded by the Child Care and Development Fund (CCDF – the most widespread childcare subsidy program in the United States) affect the employment status and earnings of low-income mothers. Employing a rich database of administrative records, we compute instrumental variables and control function estimates of the program’s effects. As an exclusion restriction, we take advantage of differences in efficiency levels across administrative agencies that process subsidy applications and payments. CCDF-funded subsidies have short-term effects that are primarily driven by changes in the extensive margin of labor supply. Mothers who are either unemployed or earning closer to the upper cutoff of eligibility benefit the most from participation in this program.

Suggested Citation

  • Zanoni Wladimir & Weinberger Gabriel, 2015. "Effects of Childcare Subsidies on Employment and Earnings of Low-Income Mothers," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(2), pages 589-619, April.
    • Handle: RePEc:bpj:bejeap:v:15:y:2015:i:2:p:589-619:n:17
    DOI: 10.1515/bejeap-2014-0128
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    Effects of welfare programs; Labor Economics Policies;

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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