Assessing the effects of the child-care fee reform on public expenditures and taxation

This paper studies the effects of the Swedish child-care fee reform on public expenditures and taxation in the municipalities. The reform implied a common system of child-care fees among all the municipalities and was introduced in 2002. In order to study its effects, we employ a difference-in-difference approach, where outcomes are compared with respect to differences in the municipalities' pre-reform fee systems. It was found that pre-reform characteristics determine taxes and expenditures in the post-reform period. We then discuss the likely causes of these differences and find that the reform did change the child-care demand in municippalities that had applied time rates relative to those who applied income dependent fees prior to reform. Changes in child-care quality were not connected to the pre-reform fee systems characteristics.

Holmlund, Linda,1975-Umeå universitet,Institutionen för nationalekonomi(Swepub:umu)liahod95 (author)
Wikström, Magnus,1963-Umeå universitet,Institutionen för nationalekonomi(Swepub:umu)mawi0007 (author)
Umeå universitetInstitutionen för nationalekonomi (creator_code:org_t)

By the author/editor: Hanes, Niklas, 1 ...; Holmlund, Linda, ...; Wikström, Magnus ...

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