Abstract

Parental leave provisions and subsidized childcare are key family policy levers in high-income countries. Policies such as paid parental leave aim to increase female labor force participation and facilitate work–life balance. However, are parental leave and childcare subsidies equivalent in terms of their impact on child development? This research brief reviews evidence from a number of causal studies focusing on the long-term effects on children exposed to either maternal care or childcare in early childhood. The authors show evidence of the changing demands among parents for childcare over time, report the effects on cognitive and noncognitive outcomes on children and discuss the role of childcare quality, parental time use and socioeconomic differences.