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Darla Moore School of Business

New Moore School professor researches shortage of child care options, its rippling effects

Dec. 19, 2019

New Moore School economics assistant professor Jessica Brown focuses her research on labor and public policy like the potential scarcity of quality child care options for working parents as well as the role people’s awareness plays in areas like insurance.

For her most recent project, Brown combines her passion for child care as a mother to two young children with her love for math in her research. She said she enjoys using her economics skills to answer questions that she cares about.

Brown’s most recent research goal is to improve the understanding of how the child care market operates. She said there tends to be a shortage of care options, and the quality of the available options is usually low.

Focused in New York City, Brown's research sample included all licensed child care facilities, but she paid close attention to facilities that operated near public pre-kindergarten education centers.

“Private child care facilities care for children from infancy until they begin kindergarten at 5 years old,” Brown said. “Day care centers typically make the most profit from the older children.”

Infants and toddlers require much more hands-on attention, so by regulation, while one teacher can care for up to 12 4-year-olds, that same teacher can only care for four infants. Day care centers do charge more for infants, but it is not enough to make up for their much higher costs. So the tuition from older children ends up underwriting some of the costs to care for the younger children.

However, Brown said parents have started to enroll their children in public education earlier as the idea of free universal pre-kindergarten for 4-year-old children gains popularity.

“Those more profitable older children leaving for the public sector could affect day care centers’ viability,” Brown said.

Brown’s research found that the expansion of free universal pre-kindergarten had the unintended consequence of reducing the availability of care for children under 2 years old.

“A back-of-the-envelope calculation indicates that for every seven 4-year-olds who shifted from day care centers to public pre-K, there was a reduction of one day care center seat for children under 2 years old,” Brown said.

Additionally, Brown’s research concluded that day care centers that are located close to pre-kindergarten sites have increased public complaints and inspection violations relative to those farther away. Brown hypothesized this decrease in quality was the result of cost-cutting in response to a reduction in enrollment.

Brown said the topics of child care and universal pre-kindergarten get a lot of political attention, but the details of this market’s operations are notably understudied.

“My research agenda will hopefully fill in some of the gaps on this topic that has such wide ramifications and unintended consequences for women’s labor force opportunities and childhood development,” Brown said.

If parents are unable to find child care for their children, they may be forced to alter their works schedules or exit the labor force.

Research in economics and other fields has also shown that children’s early environments have a disproportionate impact on later life outcomes. The quality of care they receive at these young ages could therefore have large effects in their futures.

Interested in public and labor economics, Brown’s other research topics include the role people’s awareness plays in decisions that affect public policy. Brown finds that a public information campaign designed to increase awareness of long-term care planning options did increase long-term care insurance coverage, leading to modest estimated Medicaid savings.

Looking to continue her public policy research, Brown said she is excited to join the Moore School faculty in fall 2019.

“The economics department is a very friendly and collegial group,” Brown said. “I also look forward to teaching econometrics because that is the course that sparked my love for economics when I was an undergraduate.”

Brown reminds her students that econometrics is the study of estimating causal relationships or determining whether seemingly causal connections are actually just related.

“I want my students to learn that they can read an article in the newspaper purporting that X causes Y and determine whether it’s truly causal or just a correlation,” Brown said. “I think that’s an important life skill for forming policy views and for making personal decisions.”

Even more important for students to learn, Brown said, is the significance of safeguarding their mental health. This is a lesson Brown takes to heart after one of her mentors and graduate professors died by suicide earlier this year.

“I hope that students remember that their mental health is just as important, if not more important, than their physical health,” she said. “In economics terms, we’re used to thinking of human capital as your education, but it also includes your physical and mental health.”

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