Full-time universal childcare in a context of low maternal employment: Quasi-experimental evidence from Spain

• We estimate the effects of offering full-time public childcare on maternal employment.
• 2 mothers entered employment for every 10 additional children in public childcare.
• The reform did not crowd out private childcare.
• The effect is driven by older mothers and those with two children or more.
• The results highlight the importance of the country's broader economic environment.

Using a natural experiment framework, we study the effects of offering full-time public childcare for 3-year-olds in a context of low female labor force participation and insufficient infrastructure of childcare slots. We find that two mothers entered employment for every ten additional children enrolled in public childcare. The effect is driven by mothers 30 years old and older and those with two children or more. While our estimates compare to those found earlier, they cannot be explained by a crowding out of alternative childcare modes. Nonetheless, as the reform was implemented in a period of low labor demand in Spain, our estimates may not be as modest at they appear at first sight.