Research

Fathers’ Response to Public Childcare Expansion: Whether and When to Take Parental Leave (with Nayeon Lim) 

Abstract:  This study examines the impact of public childcare expansion for children under three in Germany on parental labor dynamics, particularly focusing on fathers’ responses to the increased maternal labor supply facilitated by expanded childcare availability. Using ex-

tensive administrative data, we find that the expansion of childcare led fathers to reduce their labor supply in terms of days worked while significantly increasing their uptake of parental leave. Crucially, fathers’ leave-taking patterns closely synchronize with mothers’ return to work, highlighting the joint labor supply and leave-taking decision among couples. These findings provide broader implications for gender equality within households by demonstrating that parents coordinate their labor supply in response to family policies.

Abstract: Many countries provide cash transfers to support families. This paper investigates an unintended consequence of these policies: distortions in maternal labor supply. Using rich administrative data and exploiting state-level variation, I show that an unconditional cash transfer extends employment interruptions, leading to persistent earnings losses and divergent career trajectories. These effects are partly driven by mothers switching out of their pre-birth occupations into jobs that are lower-paying and more physically demanding. The policy context also matters: in regions with limited or more costly childcare, negative effects are more pronounced. Thus, while cash transfers to families may be well-intentioned, they can generate unintended long-term consequences for women’s careers.