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The Effects of Free Childcare on Labor Supply and Children

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  • Busse, Anna
  • Gathmann, Christina

Abstract

Many governments have introduced generous childcare subsidies to allow all children access to early childhood education. The effects of these costly programs are however still debated. In this paper, we use the introduction of free public childcare in several states in Germany to analyze its effects on children and their families. Our results suggest that the effects of public childcare depend on the child's age: free public childcare for 3-year-olds increases attendance and female labor supply, while it reduces childcare attendance for 5-and 6-year-olds. After the policy reforms, 3-year-olds improve their developmental skills in the short-run while there might be some detrimental effects for older preschool children.

Suggested Citation

  • Busse, Anna & Gathmann, Christina, 2015. "The Effects of Free Childcare on Labor Supply and Children," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113078, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc15:113078
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    Cited by:

    1. Huber, Katrin, 2019. "The role of the career costs of children for the effect of public child care on fertility and maternal employment," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-77-19, University of Passau, Faculty of Business and Economics.

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    More about this item

    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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