The Long-term Effects of After-school Care

Abstract

I investigate the long-term effects of after-school childcare on children’s human capital investment. I study a 2007 Dutch reform that expanded childcare subsidies in order to increase maternal employment, and I track impacted cohorts from childhood through young adulthood using administrative data. Exploiting cohort exposure and subsidy changes, I show that while maternal employment didn’t budge, after-school care use increased, raising children’s university graduation rates by 20%. I find that this impact results from changing beliefs and preferences rather than cognitive skills, as math scores remain unchanged. The impact is strongest among students facing the highest university access costs, particularly girls from low-educated families. Survey data explains why - the reform normalized mothers using childcare to work, increasing expected returns from university for girls. I show that the reform expanded interactions with peers from high-income and well-educated families in after-school care, potentially driving these changes.