a significant minority of parents who worked or wanted to work, especially mothers, report work difficulties relating to child care use, including having to turn down, or stop searching for paid work. There may therefore be room for New Zealand to increase its maternal labour force participation by addressing the child care-related constraints on employment. Evidence from international comparisons 2.1. Jaumotte (2003) Female labour participation: past trends and main determinants in OECD countries Jaumotte (2003) used multivariate analysis across 17 OECD countries to assess the role of various policies and labour market factors in determining the pattern of female labour participation rates among 25-54 year old women. The time period covered is 1985-1999, although most countries only had data for a sub-set of those years. Jaumotte (2003) found that, on this macroeconomic level, policies that stimulate female labour force participation included: a more neutral tax treatment of second earners tax incentives to market work between spouses child care subsidies paid parental leaves. Jaumotte that child care subsidies and paid parental leaves tended to stimulate full-time rather than part-time participation. Child benefits, that is, per-child subsidies that were not to child care, had a negative effect on part-time female participation. The following other issues were also found to correlate positively with female participation. The prevalence of part time work (used as a proxy indicator of the flexibility of the country’s labour market; although this measure suffers from endogeneity). Higher female education levels. Low overall unemployment. In addition to the multivariate analysis, Jaumotte (2003) provides a useful review of the factors that are thought to underlie the increase in female labour participation that occurred from 1981 to 2001. This review includes a summary of the pre-2003 evidence for the effects of child care subsidies on female labour supply, making the following main points. While child care subsidies reduce the relative price of child care and, therefore, increase the relative return of market work, child benefits have only an income effect and may lead to a reduction in labour supply. A number of studies have found negative elasticities of female employment to child care costs. That is, employment decreases as child care costs increase.
a significant minority of parents who worked or wanted to work, especially mothers, report work difficulties relating to child care use, including having to turn down, or stop searching for paid work. There may therefore be room for New Zealand to increase its maternal labour force participation by addressing the child care-related constraints on employment. Evidence from international comparisons 2.1. Jaumotte (2003) Female labour participation: past trends and main determinants in OECD countries Jaumotte (2003) used multivariate analysis across 17 OECD countries to assess the role of various policies and labour market factors in determining the pattern of female labour participation rates among 25-54 year old women. The time period covered is 1985-1999, although most countries only had data for a sub-set of those years. Jaumotte (2003) found that, on this macroeconomic level, policies that stimulate female labour force participation included: a more neutral tax treatment of second earners tax incentives to market work between spouses child care subsidies paid parental leaves. Jaumotte that child care subsidies and paid parental leaves tended to stimulate full-time rather than part-time participation. Child benefits, that is, per-child subsidies that were not to child care, had a negative effect on part-time female participation. The following other issues were also found to correlate positively with female participation. The prevalence of part time work (used as a proxy indicator of the flexibility of the country’s labour market; although this measure suffers from endogeneity). Higher female education levels. Low overall unemployment. In addition to the multivariate analysis, Jaumotte (2003) provides a useful review of the factors that are thought to underlie the increase in female labour participation that occurred from 1981 to 2001. This review includes a summary of the pre-2003 evidence for the effects of child care subsidies on female labour supply, making the following main points. While child care subsidies reduce the relative price of child care and, therefore, increase the relative return of market work, child benefits have only an income effect and may lead to a reduction in labour supply. A number of studies have found negative elasticities of female employment to child care costs. That is, employment decreases as child care costs increase.
The%20labour%20participation%20response%20of%20mothers%20to%20changes%20in%20early%20childhood%20education%20costs.docx