Child care arrangements and fertility: An analysis of two-earner households

The determinants of child care arrangements and relations between child care and fertility are examined using data on two-earner households from the 1976 National Survey of Family Growth. We find that the probability of relying on market arrangements is higher among families in which the husband's income, the wife's wage, and the level of the wife's labor supply are high; these households are likely to benefit the most from subsidies to the market forms of care that are small relative to the total cost of care (e.g. the present system of tax credits). In addition, parental education, family size, child's age, race, religion, and place of residence have important influences on the choice of child care mode. When other factors are held constant, reliance on a relative for child care is positively associated with intentions to have further children among couples with infants and preschoolers.