The Impact of Home Care Allowance on Children

Abstract

This article examines the effects of home care allowance on children’s care arrangements and child development. Home care allowance is provided as an alternative to other supported childcare options for children aged 1–2. The study uses extensive registry data, enabling the tracking of children’s development from early childhood to adulthood. The most significant data for measuring child development are tests conducted during pre-school health check-ups. By exploiting variations in home care allowance and municipal supplements, the study identifies the causal effect of home care allowance, distinguishing it from mere correlations between childcare type and later development. Results show that higher home care allowance prolongs mothers’ home care periods and reduces employment. Longer home care periods are associated with a higher likelihood of lower scores in the Lenetest during child health check-ups, suggesting that, by this measure, early childhood education is a better option for 1–2-year-olds. No clear effects on school grades or educational choices in the long term were found. (AI-översättning)

• ISSN: 2242-6922 (Online)
• ISBN: 978-952-209-175-8 (Online)
• Press Release in Finnish
• Publication in PDF-format