The First Three Years: Effects of Early Life Child Care on Child, Adolescent, and Young Adult Human Capital

Abstract

This paper analyzes the impact of early life child care from birth to age three on human capital outcomes. I exploit variation in the primary child care arrangements of siblings to estimate the causal effects of family- and center-based care on various child, adolescent, and young adult outcomes, after controlling for observable child and mother characteristics. Using data on mothers from the National Longitudinal Survey of Youth 1979 and subsequent data on their children, I add to findings of child care influences on cognitive achievement, social development, and physical health in early childhood by studying several adolescent and young adult outcomes as well. Although studies have established strong effects of center-based care on improved test scores, worsened behavior problems, and increased illnesses, the effects are largely dependent upon the quality of care received, the child’s race, and socioeconomic status. Results of this paper indicate that the influence of early life child care remains sizeable into adolescence and young adulthood, particularly for mathematics achievement and college attendance. There is also evidence of heterogeneity by race and mother’s marital status in the child care determinants of human capital outcomes such as health status, teenage pregnancy, and college attendance. These disparities point to inequities in access to high-quality care that have persisting effects in adolescence and beyond. The implications of these findings for parental decision making regarding child care investments and work-family policy in the United States are discussed.