The Effect of Childcare on Female Labor Supply and Child Development in Low and Middle Income Countries

Childcare services can offer an opportunity for women to develop their careers and increase household income. At the same time, it can affect the development of children, depending on the quality of care. We first develop a collective model of the household as a conceptual framework to show how improving the availability of childcare can affect mothers’ labor market opportunities and earnings and how it can affect child development. We then review the literature on the effects of childcare on the employment and earnings of women and on child development. Childcare can increase mothers’ employment. However, limited work opportunities or strict norms against maternal work can keep mothers out of the labor force. When other family members provide care, childcare can free these caregivers to work or attend school. When studies measure the impact on child development, the results are mixed and depend on both context and quality of provision.