Is There Self-Selection in the Receipt of Cash for Childcare? An Analysis of Mothers’ Paid and Unpaid Work

Abstract

The German cash for childcare benefit, implemented in 2013 and abolished only two years later, was one of the most controversial issues in Germany’s family policy of recent years. Political actors opposing the benefit, as well as researchers, were concerned that the benefit would hamper mothers’ employment and promote the traditional distribution of paid and unpaid work between mothers and fathers. Indeed, several studies have identified such effects of cash for childcare. However, it is not clear whether these effects were caused by the benefit itself or by the self-selection of recipients. The article deals with this question. Based on the 2009–2017 waves of the German Socioeconomic Panel, mothers who could have received and did receive the benefit on the basis of their child’s age are studied. For working time in a paid job, time spent on housework, and the duration of childcare, hybrid models are estimated to analyse the changes in the three variables over time for mothers who did receive the benefits and those who did not. The findings show that even before the birth of the child there are significant differences between the two groups of mothers that suggest self-selection.