The Distributional Effects of the Tax Treatment of Child Care Expenses

Tax relief for child care expenses, encompassing the Child Care Tax Credit and Dependent Care Assistance Plans, is the largest federal government program in the United States aimed at helping families with child care. We examine the distributional effects of these policies among families with children using both the National Child Care Survey and tax return data. Among families that use tax relief, the benefits average 1.24 percent of family income. Benefits as a percentage of income vary systematically over the income distribution. Despite being regressive at low income levels (mainly due to the credit being non-refundable), tax relief is progressively distributed over most of the income distribution with the ratio of benefits to income falling above the bottom quintile of the income distribution. The benefits of tax relief also vary among families with the same income depending on a family's structure and its labor market and child care choices.

CHILD CARE AND FEDERAL TAX POLICY

PANEL III: CHILD CARE AND FEDERAL TAX POLIC

The Demand for Child Care Quality: An Hedonic Price Theory Approach

I use an hedonic price theory approach to estimate the demand for child care quality. Two complementary surveys, the National Child Care Survey, 1990 (NCCS) and the Profile of Child Care Settings Study (PCS), allow me to derive an implicit price for staff-to-child ratio. I use this price as an explanatory variable in a demand equation for this quality attribute. Direct purchase-of-service contracts or voucher programs, by subsidizing only those providers that satisfy state regulatory requirements, effectively lower the implicit price of regulated attributes, such as staff-to-child ratio. Results of this study suggest that such tied subsidies have almost no influence on the demand for child care quality.

CHILD CARE AND FEDERAL TAX POLICY

PANEL III: CHILD CARE AND FEDERAL TAX POLIC

Immigrant Status, Race, and Institutional Choice in Higher Education

This paper examines the postsecondary enrollment decisions of immigrant students, expanding on previous work by explicitly considering their choices among institution types and by examining differences across generations and racial/ethnic categories. Using data from the National Educational Longitudinal Study (NELS:88), we hypothesize that community colleges may play a more significant role in providing access to higher education for immigrants than for the native-born population. Our results support our hypothesis only among Asian immigrants. First-generation black immigrants have a higher probability of enrolling in private vocational schools, while second-generation Hispanics (and native blacks) have a higher probability of enrolling in both public and private four-year colleges and universities. Survey (1988)CES,economic,research,micro,data,microdata,chief,economist