Childcare Availability, Household Structure, and Maternal Employment

We estimate the causal effects of childcare availability on the maternal employment rate using prefecture panel data constructed from the Japanese quinquennial census 1990-2010. We depart from previous contributions by controlling for prefecture fixed effects, without which the estimates can be severely biased upward. We find that the treatment effect is heterogeneous: the employment rate of mothers in nuclear households increases with childcare availability, while that of mothers in three-generation households does not. We apply our estimates to decomposition of the growth of the maternal employment rate from 1990 to 2010. The decomposition indicates that the increase in childcare availability raised the maternal employment rate by about two percentage points. We also find that dissolution of three-generation household lowered the maternal employment rate. This negative effect is more strongly pronounced in small prefectures where the household structure changed dramatically.29 p