Public childcare reform, attitudes and first births in western Germany

Sandra Krapf, Max Planck Institute for Demographic Research

The aim of this study is to investigate the relationship between childcare availability and fertility. Based on a recent policy reform in Germany, we analyze the impact of publicly provided or subsidized childcare on individual childbearing behavior. In 2008, a law was enacted that had the aim to provide 35 percent of children under age three with childcare by August 2013. The average level of childcare enrollment in this age group was 12.1 percent in western Germany in 2008. In order to achieve the policy goal of 35 percent, municipalities increased their childcare investment considerably in the last years. We take advantage of this setting and analyze the causal effect of the yearly increase of childcare enrollment rates on the district level on individual level fertility. While prior studies were criticized for the problem of reversed causality, the German reform was an initiative imposed by the federal government. Thus, we assume that the increase in childcare was an exogenous change rather than an effect of increased childcare demand. Using the new German Family Panel pairfam allows us to also consider individuals’ attitudes. It is expected that childcare provision is less important for the fertility decision of women with traditional family attitudes who might disapprove the concept of child-minding outside the family. We combine the survey data with district level childcare data for the period between 2008 and 2011. In the multivariate analysis, we use discrete time hazard models with random effects to identify the effect of changes in regional public childcare provision and their interaction with attitudes on the transition to first births.