Child care subsidies and care arrangements of low-income parents

While enrollment into early education programs has increased significantly in the past two decades, many low-income children still do not attend these programs due to lack of funding and access. This study uses data from the 2005 National Household Education Survey to examine the effects of child care subsidies on the enrollment of low-income children in early childhood education programs. Multinomial regression results show that families that receive child care subsidies are more likely to place their child in center-based preschool programs. The analyses also show that subsidy receipt increases the probability of using center care for low-income households. These findings indicate that policies aimed at increasing funding and availability of early education for low-income families can help close the gap in enrollment.

► We examine the primary child care mode choice of subsidy recipients and other households.
► Child care subsidy receipt is positively associated with the likelihood of the child being enrolled into center-based programs.
► The results also suggest that subsidy receipt increases the probability of using center care for a poor family substantially.