Evaluating the Effects of Child Care Policies on Children’s Cognitive Development and Maternal Labor Supply

Abstract

To explore the role of child care policies in the development of early cognitive skills, this paper jointly estimates a cognitive achievement production function and a dynamic, discrete choice model of maternal labor supply and child care decisions. Using counterfactuals from the model, I investigate how the design of two child care programs, Head Start and child care subsidies, affects the formation of cognitive skills through maternal work and child care decisions. The results suggest large impacts on cognitive skills from expanding Head Start to current noneligibles and negligible impacts of subsidies on cognitive skills of current eligibles.