There is ample debate on whether and for whom policies might affect the child penalty in women’s earnings. Here we link it to local fiscal rules affecting public childcare provisions. We rely on Italian administrative data on private employees complemented by municipal budgets, and combine a regression discontinuity design with event studies. 

We find that municipalities subjected to fiscal austerity face relative shortages driven by fewer daycare slots and (accepted) applications. The effects of these shortages are mostly null, except for women with higher earnings in Italy’s otherwise ‘daycare-rich’ Centre. There, child penalties increase by up to a quarter, as shortages are compensated via shorter weeks and part-time employment. When public childcare is lacking, some women use more parental leave, but without incurring in further earnings losses. Attending to income and geographical disparities might be crucial to understand and remedy gendered economic inequalities spurred by shortages and otherwise limited daycare.

Unpaid carers often experience economic insecurity despite having paid work. Dubbed a ‘new’ social risk, related social policies and research have focused on promoting employment and bolstering the public safety net when insufficient or absent. Yet the design of existing benefit programs might also have ‘new’ perverse effects. Here I ask how large, for how long, among whom, and why, by analysing the UK’s Carer’s Allowance and its earnings limit.

I rely on survey interviews from fifteen waves of Understanding Society (2009-2024). Economic insecurity is examined by combining material indicators (arrears, income losses, savings) as well as perceptions (financial worry, satisfaction with incomes). I compare carers with a history of Carer’s Allowance receipt to those without as their earnings progress in an event-study design.

Insecurity declines as earnings increase, but not homogeneously among carers. Past the earnings limit, carers with a history of Carer’s Allowance receipt report relatively more arrears with bills and housing, less regular savings, heightened financial worries, and more dissatisfaction with income. The relative gap in insecurity is large, persistent over time, and extends to the whole household. Although findings are generally mixed across socio-economic groups, renters drive estimates for arrears and middle- and working-class carers experience the most worries and dissatisfaction. Changes in insecurity appear unrelated to variation in caregiving involvement. Rather, differences in incomes, employment, and benefit receipt widen past the limit.

By foregrounding the role of policy design, findings speak to studies on social risks and economic insecurity, broadening the case for reforms aimed at carers mixing paid and unpaid work.