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Free Daycare and Its Effects on Children and Their Families

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  • Anna Busse
  • Christina Gathmann

Abstract

Many governments invest substantial public funds to foster early childhood education. And yet, there are still many open questions who responds to and who benefits from public investments into early childcare. We use the introduction of free public daycare in German states to analyze its effects on children and their families. Our results suggest that effects of the policy differ by child age, gender and socio-economic status. Free daycare increases attendance among 2-3 year olds with little response among older children. Yet, even with access to free daycare, we find few effects on maternal labor supply. Responses are generally stronger for poorer households and other vulnerable families. Child development, in turn, shows gender-specific effects that are in part explained by the differential choices parents of boys make compared to parents of girls.

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  • Anna Busse & Christina Gathmann, 2018. "Free Daycare and Its Effects on Children and Their Families," SOEPpapers on Multidisciplinary Panel Data Research 958, DIW Berlin, The German Socio-Economic Panel (SOEP).
    • Handle: RePEc:diw:diwsop:diw_sp958
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    Cited by:

    1. Verena Löffler, 2024. "The Cost of Fair Pay: How Child Care Work Wages Affect Formal Child Care Hours, Informal Child Care Hours, and Employment Hours," SOEPpapers on Multidisciplinary Panel Data Research 1205, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Mathias Huebener & Sevrin Waights & C. Katharina Spiess & Nico A. Siegel & Gert G. Wagner, 2021. "Parental well-being in times of Covid-19 in Germany," Review of Economics of the Household, Springer, vol. 19(1), pages 91-122, March.
    3. Huebener, Mathias & Pape, Astrid & Spiess, C. Katharina, 2020. "Parental labour supply responses to the abolition of day care fees," Journal of Economic Behavior & Organization, Elsevier, vol. 180(C), pages 510-543.
    4. Eric Schuss & Mohammed Azaouagh, 2021. "Combining parenthood and work: transmission channels and heterogeneous returns to early public childcare," Review of Economics of the Household, Springer, vol. 19(3), pages 641-676, September.
    5. Eric Schuss & Mohammed Azaouagh, 2023. "The expansion of early childcare and transitions to first and second birth in Germany," Bulletin of Economic Research, Wiley Blackwell, vol. 75(2), pages 476-507, April.
    6. BOUSSELIN Audrey, 2019. "Expanding access to universal childcare: Effects on childcare arrangements and maternal employment," LISER Working Paper Series 2019-11, Luxembourg Institute of Socio-Economic Research (LISER).
    7. Sandner, Malte & Thomsen, Stephan L., 2018. "The Effects of Universal Public Childcare Provision on Cases of Child Neglect and Abuse," IZA Discussion Papers 11687, Institute of Labor Economics (IZA).
    8. Malte Sandner & Stephan L. Thomsen & Libertad González Luna, 2020. "Preventing child maltreatment: Beneficial side effects of public childcare provision," Economics Working Papers 1744, Department of Economics and Business, Universitat Pompeu Fabra.

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    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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