Can Child Care Policy Encourage Employment and Fertility? Evidence from a Structural Model

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract In this paper we develop a structural model of female employment and fertility which accounts for intertemporal feedback effects between the two outcomes. We identify the effect of financial incentives on the employment and fertility decision by exploiting variation in the tax and transfer system which differs by employment state and number of children. To this end we simulate in detail the effects of the tax and transfer system including child care costs. The model provides estimates of structural preferences of women which can be used to study the effect of various policy reforms. In particular, we show that increasing child care subsidies conditional on employment increases labor supply of all women as well as fertility of the childless and highly educated women. Terms of use: Documents in

Financial support for families with children and its trade-offs: balancing redistribution and parental work incentives

“…At the same time these same benefits however, could have negative effect on parental incentives to work, particularly for the so-called second earners, usually mothers (see e.g. Laroque and Salanie, 2008;Kornstad and Thoresen, 2007;Haan and Wrohlich, 2011). Benefits and low employment among mothers might positively affect timing of childbirth and influence fertility (Laroque and Salanie, 2008;Matysiak and Vignoli, 2008;Gauthier, 2007;Duclos, et al, 2001).…”

Pension Wealth and Maternal Employment: Evidence from a Reform of the German Child Care Pension Benefit

“…For the US, Guner et al (2013) find that a hypothetical fully subsidized provision of child care to all households would substantially increase participation rates among married females by 10%. For Germany, Haan and Wrohlich (2011) find that higher subsidized child care, conditional on employment, increases maternal employment.…”

“…Summaries of empirical studies are provided by Anderson and Levine (1999), Blau and Currie (2006) and Blau and Tekin (2007). The first set of studies relies on structural models (Guner et al, 2013;Haan and Wrohlich, 2011). For the US, Guner et al (2013) find that a hypothetical fully subsidized provision of child care to all households would substantially increase participation rates among married females by 10%.…”

Women's Access to Economic Opportunities in Serbia

“…Furthermore, survey questions to explore this issue are limited.For example, the SILC does not include a question about the reasons for nonparticipation. Labor force participation among women who have children is responsive to the availability and cost of childcare (Del Boca 2002;Del Boca and Vuri 2007;Haan and Wrohlich 2009). Public childcare services are provided by local municipalities.…”