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Child Care Costs and the Employment Status of Married Australian Mothers

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  • Anu Rammohan
  • Stephen Whelan

Abstract

Using data from the HILDA (Household Income and Labour Dynamics), this paper examines the implications of child care costs on maternal employment status by distinguishing between full-time and part-time work. Our empirical approach uses an ordered probit model taking into account the endogeneity associated with both wages and child care costs. Results indicate that child care costs have a statistically insignificant effect on the decision to work either full time or part time. Moreover, the reported elasticities of part-time and full-time work with respect to child care costs are relatively low. This suggests that the significant subsidies paid to users of child care may have a limited role in increasing the labour market activity of married mothers.

Suggested Citation

  • Anu Rammohan & Stephen Whelan, 2006. "Child Care Costs and the Employment Status of Married Australian Mothers," CEPR Discussion Papers 517, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    • Handle: RePEc:auu:dpaper:517
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    File URL: https://www.cbe.anu.edu.au/researchpapers/CEPR/DP517.pdf
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    References listed on IDEAS

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    Cited by:

    1. Guyonne Kalb, 2009. "Children, Labour Supply and Child Care: Challenges for Empirical Analysis," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 42(3), pages 276-299, September.
    2. Justine McNamara & Rebecca Cassells, 2006. "Trends in child care use and cost between 1999 and 2002," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 9(2), pages 125-146, June.
    3. Guyonne Kalb & Wang‐Sheng Lee, 2008. "Childcare Use And Parents’ Labour Supply In Australia," Australian Economic Papers, Wiley Blackwell, vol. 47(3), pages 272-295, September.

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    More about this item

    Keywords

    female labour supply; child care; part-time; full-time;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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