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The Effect of Childcare Availability and Intergenerational Income Mobility

Abstract:

The chance that a child from a low income family will achieve economic prosperity varies significantly across the United States: economic mobility is more difficult if you are born or grow up in certain parts of the country. There is an urgent need to identify the features that generate mobility in certain places, and those that limit it in others. I explore the role that the availability of childcare plays in local economic mobility. Using county-level measures of intergenerational income mobility, I relate mobility for children from poor and rich families to the availability of center- and home-based childcare providers in a county. I find positive associations between the availability of home-based care and mobility of children from both poor and rich families. I also find negative associations between the availability of center-based care for children from poor families, especially boys. I also explore variation in the local childcare availability rate generated by regulations that require higher student-to-teacher ratios in center-based care. These regulations caused center-based facilities to close, especially in poor neighborhoods. I find that the regulations are associated with lower mobility among children from poor families who live in poor counties, suggesting that the closing of center-based facilities reduced mobility of children born in affected counties and years.

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