Working Paper: CEPR ID: DP17243
Authors: Kjetil Bjorvatn; Denise Ferris; Selim Gulesci; Arne Nasgowitz; Vincent Somville; Lore Vandewalle
Abstract: In a field experiment in Uganda, mothers of young children are randomly offered a childcare subsidy, an equivalent cash grant, both or nothing. Childcare leads to a 44 percent increase in household income, which is at least as large as the impact of the cash grant and driven by an increase in mothers' business revenues and fathers' wage earnings. The childcare subsidy also improves child development while the cash grant does not. Overall, our findings demonstrate that childcare subsidies can be an effective policy to simultaneously promote child development and reduce poverty in a low-income context.
Keywords: childcare; preschool; cash transfers; income; labor supply; entrepreneurship; gender; child development
JEL Codes: I38; J13; J22; O12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Childcare treatment (J13) | Household income (D19) |
| Childcare treatment (J13) | Mothers' business revenues (D13) |
| Childcare treatment (J13) | Fathers' wage earnings (J31) |
| Childcare treatment (J13) | Child development (J13) |
| Childcare access (J13) | Positive developmental outcomes for children (J13) |
| Cash grant (H81) | Child development (J13) |
| Childcare treatment and cash treatment (J13) | Household labor supply (D13) |
| Childcare treatment and cash treatment (J13) | Business assets (G31) |
| Childcare treatment and cash treatment (J13) | Number of employees (M51) |