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The Unintended Consequences of Childcare Regulation: Evidence from a Regression Discontinuity Design

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  • Eugenio Rojas
  • Rafael Sánchez
  • Mauricio G. Villena

Abstract

In several countries governments fund childcare provision but in many others it is privately funded as labor regulation mandates that firms have to provide childcare services. For this later case, there is no empirical evidence on the effects generated by the financial burden of childcare provision. In particular, there is no evidence on who effectively pays (firms or employees) and how (e.g., via wages and/or employment). Our hypothesis is that in imperfect labor markets, firms will transfer childcare cost on to their workers. To analyze this, we exploit a discontinuity in childcare provision mandated by Chilean labor regulation.

Suggested Citation

  • Eugenio Rojas & Rafael Sánchez & Mauricio G. Villena, 2016. "The Unintended Consequences of Childcare Regulation: Evidence from a Regression Discontinuity Design," Journal of Applied Economics, Taylor & Francis Journals, vol. 19(1), pages 1-39, May.
    • Handle: RePEc:taf:recsxx:v:19:y:2016:i:1:p:1-39
    DOI: 10.1016/S1514-0326(16)30001-0
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    JEL classification:

    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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