Scandinavian Working Papers in Economics
Working Papers in Economics,
University of Gothenburg, Department of Economics
No 157: Child-care quality and fee structure: Effects on labor supply and leisure composition
Anna Brink () and Katarina Nordblom ()
Additional contact information
Anna Brink: Department of Economics, School of Economics and Commercial Law, Göteborg University, Postal: Box 640, SE 405 30 GÖTEBORG
Katarina Nordblom: Department of Economics, School of Economics and Commercial Law, Göteborg University, Postal: Box 640, SE 405 30 GÖTEBORG
Abstract: This paper studies the effects of public child-care subsidies on parental time allocation. We develop a model where parents are allowed to utilize subsidized care during both working and leisure hours. The model distinguishes between subsidies to child-care quality and to fees. Three types of fees are considered: flat, based on time spent in care, and based on parental income. We show that parental time allocation depends on whether quality or fees are subsidized, and also that fee subsidies have di erent e ects depending on the fee structure. We further show that even if a subsidy increases the use of public care, the effect on labor supply may be unclear due to the possibility of using child care also when not working.
Keywords: Public child care; Child-care quality; Child-care fees; Time allocation; Labor supply
23 pages, January 23, 2005
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