No Right Answers in the Mommy Wars

For decades researchers have studied whether day care is good or bad for kids, and to call the results “mixed” would be an understatement. Whether a given child will be better off at home or elsewhere seems to hinge on a complicated mix of factors, from the obvious (the quality of the care he’s getting at home vs. the quality of care on offer elsewhere) to the less so (how much he’ll benefit from the extra income a parent might earn if he’s put in day care, how much he bonds with his teachers).

An interesting figure in this debate, though, has been Jonathan Gruber of the Massachusetts Institute of Technology, an architect of Obamacare and hardly someone who would instinctively recoil at the thought of government-funded child care. Famously, he and some colleagues studied a universal child-care program for kids 0-4 in Quebec, finding it was bad for children over the long term across a wide variety of outcomes, from crime rates to life satisfaction. Other researchers confirmed the results.

Now Gruber has turned his attention to Finland with a different group of coauthors, looking at a very different type of government “nudging” of parents. Under a Finnish “home care allowance” implemented in 1985, a parent can be paid to stay home with kids under 3.

But it seems this intervention is also bad. The home-care benefits, he reports, “negatively affect the early childhood cognitive test results of children, decrease the likelihood of choosing academic high school, and increase youth crimes.”

You read that right: In Quebec, putting kids 0-4 in government-funded care was bad for them. In Finland, keeping kids under 3 with their parents by paying their moms to stay home was bad for them too—at least according to the same scholar’s research.

Let’s dig into the new study a bit to see if we can figure out what’s going on. It’s well-done, combining numerous data sources to paint a detailed picture of how kids developed over time. Nordic countries famously keep deep “registries” of information on their citizens, making them especially good places to study.

In Finland, all families are eligible for the home-care allowance, but poorer parents get a bit more, and municipalities sometimes provide extra money. More than 80% of Finnish moms use the home-care allowance for at least two months, even though day care in the country is also heavily subsidized and considered relatively high quality, making Finland an outlier in terms of child-care arrangements among otherwise similar nations.

Gruber et al. basically look to see if kids’ outcomes changed along with the popularity of the home-care program—which shifted over time thanks to changes in the municipal supplements, as well as a 1997 reform that affected the price of day care (which of course affects how attractive the home-care option is in comparison).

To put some more precise numbers on the findings, each 100 euro (in the ballpark of $100) increase to the monthly supplement decreased maternal labor supply by about 1.5%, increased the chance a child would fail a cognition test by about 7%, reduced the chance of enrolling in an academic high school instead of a vocational one by 0.6 points, and increased the chance of youth criminal sentencing by 0.22 points. Decreases in the cost of day care generated basically similar results in the opposite direction.

The authors also probe some possibilities that have been raised elsewhere in the literature. For example, higher-class parents are able to provide richer environments at home, so their kids might be worse off in day care, even if day care is an improvement for poorer kids. But no, in Finland, Gruber et al. did not find much evidence for this kind of pattern.

In one sense, maybe it’s not too hard to reconcile Gruber’s efforts: He got two different results for two different policies in two different contexts. In Finland, kids are better off in the country’s decent-quality day cares than in the care of parents bribed to keep them home, and these kids might also benefit from the higher incomes their parents earn when they’re in day care. In Quebec, kids are worse off when shifted via rock-bottom subsidized prices into lower quality day care programs. 

But that highlights how hard it is to draw conclusions that apply more generally—especially to somewhere like the U.S., with its wide range of child care options, or to a mere proposal for “universal child care” that may turn out any number of ways.

My inner scientist says we should be skeptical that either the Finnish experience or the Quebec experience will generalize to our own. My inner cynic counters that maybe we should just ignore social science if decades of study can’t resolve a question as seemingly straightforward as this one. The libertarian in me, meanwhile, wants to gloat that government interventions into family life seem as likely to harm as to help. Maybe parents will naturally evaluate tradeoffs in a sensible way, and we shouldn’t bribe them off the course they’ll choose on their own.

As a parent, though, I’m just frustrated there aren’t clearer answers for people who want to do the best thing for their kids.

Robert VerBruggen is an IFS research fellow and a fellow at the Manhattan Institute.