Studies on the Supply and Demand for High-Quality Early Care and Education
(Family and Child Policy)
*Names in bold indicate Presenter
High-quality early care and education (ECE) can improve children’s school readiness, especially for disadvantaged children. However, many ECE programs are not high-quality. Policy-makers have tried to improve the quality of care through a variety of mechanisms. At the federal level, the Child Care and Development Block Grant (CCDBG) Reauthorization Act of 2014 and the 2016 Child Care and Development Fund final rule updated states’ child care licensing requirements and quality standards. Federal agencies also encourage states to create Quality Rating and Improvement Systems (QRIS). QRIS are designed to improve the quality of ECE by defining quality standards (including around staffing), providing supports, and making quality transparent. QRIS, theoretically, increase the supply of high-quality ECE through state support and increase the demand for high-quality ECE by addressing the information asymmetry inherent in the ECE market. Another way states incentivize quality is to offer higher child care subsidy reimbursement rates to high-quality providers. The papers on this panel examine the supply and demand for high-quality ECE through econometric and mixed methodologies.
Many state QRIS incorporate staff requirements, requiring that staff have certain credentials for an ECE provider to reach the highest QRIS ratings. Staff that have received more education and earned credentials may expect to be paid more. However, at the same time that states have implemented QRIS, the U.S. has seen an increase in the share of low-skilled immigrants participating in the ECE workforce. The first paper used an instrumental variables approach to examine the impact of rising low-skilled immigration on the supply of native ECE workers, compensation, and market prices. Data come from the 1990–2010 U.S. Decennial Census (IPUMS) and 1990–2017 Quarterly Census of Employment and Wages.
The second paper examined whether an incentive system that provided additional child care subsidy payments to centers that achieved a high QRIS rating improved the supply of high-quality ECE in 2018. The study used U.S. Census data and administrative child care and subsidy data from Maryland to conduct multilevel logistic regressions. The study also included 14 interviews with center directors to understand how they made decisions about which QRIS rating to attain.
The third paper examined the patterns of changes in licensed providers in a state that implemented CCDBG requirements earlier than required. The study used child care provider and child-level subsidy data from Massachusetts to examine changes between 2012 and 2018, including changes to the number of high-quality providers. The study also estimated event history models to examine whether the regulations were associated with provider exits from the child care market, controlling for provider characteristics.
While the first three papers examined the supply of high-quality ECE, including highly-skilled staff, the final paper examined the role of distance in the ECE decisions of low-income families. The study used administrative child care and subsidy data from Minnesota to estimate a multinomial logit model to describe the demand for ECE, given the characteristics of the local child care market. The model tests how ECE decisions differ across household income and QRIS ratings.