Social investment - Growth, employment and financial sustainability: Economic and fiscal effects of improving childcare in Austria

Summary:

This article illustrates the positive effects of investments in social services using the example of childcare. The new model calculations show that these could, not only have considerable employment effects - depending on overall economic development, but also make substantial additional revenues for public funds possible. What needs to be said upfront is that even in the case of relatively pessimistic assumptions about growth of the economy and employment the costs of more and improved childcare will at least be neutralized by the additional revenues (more taxes and contributions and savings in unemployment benefits). A detailed description of the calculation with all details and assumptions can be found in the appendix.