The economics of child care and public policy

Child care denotes any arrangement used by a working parent for care of a child, including self-care. This article is concerned with the factors that influence the demand for market modes of child care by two parent families with working mothers. A unique aspect of the study is that it is able to assess the impact of a child care subsidy program. An implication of the analysis is that the demand for market care is price elastic and is therefore susceptible to considerable change through programs of increased subsidization.