Do comprehensive and diverse childcare services affect women’s labour supply and well-being?

Abstract

This paper estimates the effect of comprehensive and diverse regional childcare services on Japanese women’s labour participation and well-being. On the basis of a sequence of childcare policies introduced in the early 2000s in Japan, we apply the difference-in-differences method. Our empirical results show that these services had positive heterogeneous effects on women’s labour supply in terms of extensive and intensive margins, depending on their employment type. Furthermore, we find a mixed result that the availability of such childcare services deteriorated the subjective well-being of regular employees possibly due to the increased working hours, but improved that of nonregular employees possibly due to the increased participation in the labour market.