Anna Lovász – Ágnes Szabó-Morvai (2013): Does Childcare Matter for Maternal Labor Supply? A modified Regression Discontinuity Analysis
The research, funded by the National Scientific Research Fund, implemented by HETFA Research Institute and the Institute of Economics of the Centre for Economic and Regional Studies of the Hungarian Academy of Sciences, draws on the effects of childcare on maternal labour supply in Hungary.
We use a variant of the regression discontinuity method to estimate the effect of subsidized childcare availability on mothers’ labor supply when other factors (maternity leave, preferences regarding separation) change simultaneously. We separate the age and calendar-specific childcare effect from those that are only age-specific by comparing treatment and control groups by holding children’s age constant, and combine RD with difference-in-differences to account for seasonal effects. Our estimates suggest that childcare availability has a significant positive impact of around 18%. The results highlight the importance of methods that control for endogeneity and concurrent age-related effects, and a comprehensive policy approach.