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An Empirical Assessment of the Drivers of Formal and Informal Childcare Demand in European Countries

Author

Listed:
  • Laurène Thil

    (HIVA - HIVA (Higher Inst. for Labour Studies) / Dept of Educational Sciences - KU Leuven - Catholic University of Leuven = Katholieke Universiteit Leuven, KU Leuven - Catholic University of Leuven = Katholieke Universiteit Leuven)

  • Laté Ayao Lawson

    (UNISTRA - Université de Strasbourg, BETA - Bureau d'Économie Théorique et Appliquée - AgroParisTech - UNISTRA - Université de Strasbourg - Université de Haute-Alsace (UHA) - Université de Haute-Alsace (UHA) Mulhouse - Colmar - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Mathieu Lefebvre

    (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

Abstract

How does the mother's labour supply affect the household's demand for childcare? And thus are formal and informal childcare substitutable? In this paper, we address these two questions using micro-data for 14 European countries observed over the period between 2010 and 2017. Relying on a Control Function Approach to account for the endogeneity between childcare and the mothers' labour supply, we identify different factors affecting the demand for formal and informal childcare. The results show that the mother's labour supply is a key element in understanding the demand for childcare and suggest that the more the mother participates in the labour market, the higher the household's demand for childcare services. Moreover, our results support the substitutability hypothesis between formal and informal childcare. Policymakers aiming to promote mothers' employment should increase the availability of formal childcare services, as this will increase labour supply by mothers and reduce the use of informal care arrangements.

Suggested Citation

  • Laurène Thil & Laté Ayao Lawson & Mathieu Lefebvre, 2023. "An Empirical Assessment of the Drivers of Formal and Informal Childcare Demand in European Countries," Post-Print hal-04239723, HAL.
    • Handle: RePEc:hal:journl:hal-04239723
    DOI: 10.1007/s11205-023-03198-3
    Note: View the original document on HAL open archive server: https://amu.hal.science/hal-04239723
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    Keywords

    Instrumental variable; Childcare; Mothers’ labour supply;
    All these keywords.

    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
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

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