Working Paper: CEPR ID: DP4357
Authors: Alison L. Booth; Melvyn G. Coles
Abstract: We model educational investment, wages and employment status (full-time, part-time or non-participation) in a frictional world in which heterogeneous workers have different productivities, both at home and in the workplace. We investigate the degree to which there might be under-employment and distortions in human capital investment, and we then show how childcare policy can be used not only to correct the ex post under-participation problem but also to provide efficient incentives to invest optimally ex ante in education.
Keywords: childcare; education; fulltime; market failure; parttime
JEL Codes: H24; J13; J24; J31; J42
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Employment subsidies (J68) | Educational investment (I26) |
| Employment subsidies (J68) | Female labor market participation (J21) |
| Higher workplace participation (J29) | Better education (I24) |
| Better education (I24) | Higher participation rates (J49) |
| Childcare policies (J13) | Female labor market participation (J21) |
| Childcare policies (J13) | Proportion of women with tertiary education (I24) |