Impacts of early childhood care subsidy designs on the care services market
Won Lee, University of Minnesota
Aaron Sojourner, University of Minnesota
Liz Davis, University of Minnesota
11/7/2019
2019 APPAM, Denver, CO
Motivation and relevance
ECE subsidies can increase human capital accumulation, especially for children from disadvantaged families.(Barnett, 2008; Chaparro & Sojourner, 2015; Duncan & Magnuson, 2013; Duncan & Sojourner, 2013; Heckman, 2006)
Many policymakers want to invest in ECE:
Uncertainty remains about how subsidy expansions affect crowd-out, prices, and other outcomes.
Less study of how ECE subsidy policies affect the ECE services market
Large variation in ECE subsidies in Minnesota in recent years
Research Question
To what extent does each additional subsidy of $10,000 per child in a community's population affect:
the quantity and types of care services
market prices of care services
differently if the subsidy target infants and toddlers (age 0-2) or preschoolers (age 3-5)
differently if the subsidy target public providers or private ones
Literature
Funding for child care subsidies have been associated with growth in the number of providers (Hatfield et al 2015; Cochi Ficano 2006; Kreader et al., 1999)
Only few but growing lierature on the system-level impacts:
Effects of universal prekindergarten
Georgia (voucher) and Oklahoma (school based) on capacity, ECE workforce and pay (Bassok, Fitzpatrick, Loeb, 2014)
Floridas rollout on county-level capacity (Bassok, Miller Galdo, 2016)
NYC rollout on hex-level capacity (Brown, 2018)
Data
Provider Data
Provider-year level data
2012-2015 NACCRAware (DHS)
Capcity
Price
Location
Other characteristics (Care Type, Age-group served)
Policy Data
Locale-year level data
Various sources (no unified data system)
Multiple programs at different geographic-level
Analytic Data
Harmonize to the school-district level
Measures
Outcome
Total quantity
By provider type (Center, Family, and Public), by age group (infant, toddler, and preschool)
Average Price
By provider type (Center, Family, and Public), by age group (infant, toddler, and preschool)
Share highly-rated under the state's quality rating and information system (3 or 4 stars in Parent Aware QRIS system)
Treatment
Policy dollar amounts
$ per child, if outcomes that are averages (prices)
$ level, if outcomes that are totals (capacity)
Policy Data Sources
Program
Age 0-2
Age 3-5
Private
Public
Data Observed
Race to the Top (RTT) scholarships
Y
Y
Y
transformation zone
Early Learning Scholarship family (ELSF)
Y
Y
super-county zone
Early Learning Scholarship provider (ELSP)
Y
Y
school-district zone
Early Head Start
Y
Y
provider location
Head Start
Y
Y
provider location
Child Care Development Fund
Y
Y
Y
residence location
Voluntary Prekindergarten
Y
Y
residence location
All-Day Kindergarten
Y
Y
provider location
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Note: Public and rectricted data comes from either Minnesota Department of Education or Department of Human Services
Descriptive characteristics of policy variables (School district-year level, 2012-2015)
Mean
Std. Dev.
All funding
74.715
236.621
Private-provider funding
44.139
148.663
Private-young funding
14.178
46.136
Private-old funding
29.961
103.184
Public-provider funding
30.576
97.767
Public-young funding
5.617
19.731
Public-older funding
24.959
80.681
AllDayK funding
101.531
220.587
Funding/kid
0.125
0.215
Private-prov funding/kid
0.065
0.084
Private-young funding/kid
0.048
0.132
Private-older funding/kid
0.049
0.082
Public-prov funding/kid
0.061
0.167
Public-young funding/kid
0.048
0.132
Public-older funding/kid
0.013
0.063
AllDayK funding/kid
0.097
0.076
Young funding/kid
0.063
0.132
Older funding/kid
0.062
0.117
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Note: The policy per children under age 5 variables in dollar ($10,000).; The policy variables in dollar ($10,000) ; N=1191
Descriptive characteristics of age-specific outcome variables (School-District level)