Universal Childcare for the Youngest and the Maternal Labour Supply

Abstract

In this paper, we investigate whether the expansion of childcare leads to an increase in the female labour supply. We measure female labour supply at both the extensive and intensive margin. For identification, we exploit a nationwide reform that expanded childcare for 1-2year-olds in Norway. Our results reveal a significant increase in the overall employment of mothers in the target group, but only weak evidence of an increase in contracted hours of work. However, both adjustments are only short term following the reform. When we consider subgroups of mothers more closely, we find substantial heterogeneity in the affected outcomes and the timing of these effects. In particular, when we exclude mothers on job-protected maternity leave and with currently zero hours of work from the target group, we estimate even larger effects on employment and now significant effects on actual hours of work. For mothers with more than one child, we find significant long-term effects of the reform on both employment and hours of work.

From homemakers to breadwinners? How mandatory kindergarten affects maternal labour market outcomes

“…One strand of literature examines whether the provision of discounted childcare like in Austria (Kleven et al, 2020), Norway (Hardoy and Schøne, 2015), Sweden (Lundin et al, 2008), and the Netherlands (Bettendorf et al, 2015) impacts maternal employment. Further research work analyses the expansion of childcare places as done in Spain (Nollenberger and Rodríguez-Planas, 2015), Italy (Carta and Rizzica, 2018), Germany (Geyer et al, 2015), and Norway (Kunze andLiu, 2019, (Eckhoff Andresen andHavnes, 2019) or a legal entitlement for it in Germany (Bauernschuster and Schlotter, 2015). The evaluation of these policies suggests a significantly positive effect on mothers' labour force participation, provided a low labour force participation rate and a small extent of childcare prior to the reform.…”