TY  - JOUR
AU  - Mocan,H. Naci
TI  - Quality Adjusted Cost Functions for Child Care Centers
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 5040
PY  - 1995
Y2  - June 1995
UR  - http://www.nber.org/papers/w5040
L1  - http://www.nber.org/papers/w5040.pdf
N1  - Author contact info:
Naci H. Mocan
Department of Economics
Louisiana State University
2119 Patrick F. Taylor Hall
Baton Rouge, LA 70803-6306
Tel: 225/578-4570
E-Mail: mocan@lsu.edu
AB  - Using a newly compiled data set, this paper estimates multi- product translog cost functions for 399 child care centers from California, Colorado, Connecticut, and North Carolina.  Quality of child care is controlled by a quality index, which has been shown to be positively related to child outcomes by previous research. Nonprofit centers that receive public money, either from the state or federal government, (which is tied to higher standards), have total variable costs that are 18 percent higher than other centers, keeping quality of services constant. No statistically significant differences between general categories of for-profit and non-profit centers are detected. Furthermore, various types of nonprofits are not distinguishable from their for-profit counterparts.  In agreement with previous studies, the data show that the average quality of center-based child care is between 'minimal' and 'good', and it costs 13 cents per hour per child to increase this average quality to the level considered developmentally appropriate by child care experts.
ER  -