||Effects of Subsidized Childcare on Mothers’ Labor Supply Under a Rationing Mechanism
||Shintaro Yamaguchi, Yukiko Asai, Ryo Kambayashi
We estimate the marginal treatment effect of childcare use on mothers’ labor market outcomes by using a staggered expansion of childcare services across regions in Japan. The estimates show that the treatment effect is negatively associated with propensity to use childcare, which implies that mothers who increase their labor supply more are less likely to use childcare. Negative selection into treatment arises, because the childcare rationing rule gives preferential treatment to mothers who work full-time before they apply for childcare. These mothers are strongly attached to the labor market and likely to work regardless of the availability
of subsidized childcare.
||Paper in English (47 pages)