Scandinavian Working Papers in Economics

Working Paper Series,
IFAU - Institute for Evaluation of Labour Market and Education Policy

No 2014:22: Does early child care help or hurt childrens's development?

Christina Felfe () and Rafael Lalive ()
Additional contact information
Christina Felfe: University of St. Gallen, Postal: St. Gallen, Switzerland
Rafael Lalive: University of Lausanne, Postal: Lausanne, Switzerland

Abstract: More children than ever attend center-based care early in life. We study whether children who attend center-based care before age 3 have better or worse language and motor skills, socio-emotional maturity, and school readiness just before entering primary school. In data covering about 36,000 children in one West German state, we use a marginal treatment effects framework to show how causal effects vary with observed characteristics of children, parents, and care centers and with unobserved preferences for center-based care. Early center-based care benefits children with less educated mothers or foreign parents. Benefits increase when parents have a preference for center-based care. Centers with small playgroups and with experienced, trained, or full-time working staff produce the best effects. A modest expansion of the number of places in early care centers improves children's development, whereas a strong expansion has no significant effects.

Keywords: Child care; child development; marginal treatment effects

JEL-codes: I21; I38; J13

53 pages, October 10, 2014

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