Childcare and Maternal Employment

Working Paper 2021-584

Abstract

Little literature currently exists on the effects of childcare use on maternal labor market outcomes in a developing country context, and the few recent studies offer mixed results. We attempt to fill these gaps by analyzing several latest rounds of the Vietnam Household Living Standards Survey spanning the early to mid-2010s. Addressing endogeneity issues with a regression discontinuity estimator based on children’s birth months, we find sizable and positive effects of childcare on women’s own labor market outcomes and their household income and poverty status. The effects of childcare differ by women’s characteristics and are stronger for more educated women. These effects are also somewhat larger for younger children and areas with higher income levels. Furthermore, we also find that some positive effects last after two years.

Authors: Hai-Anh Dang, Masako Hiraga, Cuong Viet Nguyen.