April 2004

IZA DP No. 1121: Child Care Subsidy Receipt, Employment, and Child Care Choices of Single Mothers

published in: Economics Letters, 2005, 89 (1), 1-6

This paper examines the impact of actual subsidy receipt of single mothers on their joint employment and child care mode decisions in the post-welfare reform environment, which places a high priority on parental choice with the quality and type of care chosen. Results indicate that single mothers are highly responsive to child care subsidies by increasing their employment while moving from parental and relative care to center care in the process.