Research

This paper estimates the long-run effects of informal childcare, provided by grandparents, and formal childcare, provided by kindergarten, on human capital outcomes in China. Using data on childcare choice in early childhood, I find that both types of childcare lead to higher educational attainment and better job outcomes. Moreover, the effect of grandparental childcare is stronger for girls, consistent with the son preference. I also find evidence that the kindergarten effect on human capital accumulation is caused by increased maternal labor income and decreased family size. My findings highlight the important role of grandparents and public childcare for children in under-developed areas.

This paper exploits a family plan policy change in December 2013, which allowed couples in which either side is an only child to have two children without any penalty. Using a Difference-in-Difference setting and individual-level data collected in 2010, 2012 and 2014, we investigate how prime-age married women affected by the policy changed their labor market decision in three dimensions: labor market participation, working hours and monthly earnings. We find that the policy increased the monthly labor supply of treated women by 15 hours, while it had no significant effect on the monthly wage. We find no effects of the policy change for women in the agricultural sector, self-employed women, or male workers. Furthermore, women having the first child at a later age, a longer tenure on the job, or working in a state-owned enterprise experienced smaller effects. The policy impact did not vary with the women's desired numbers of children, a variable that is usually unknown to the employer. All the above evidence suggests that employers use observable productivity-related characteristics to screen women, expecting that those who are more likely to have kids after the policy change will invest less in their job.