The hidden trade-offs of regulating childcare quality

Abstract

I study how a childcare quality law affected enrollment and parental employment in Spain. The policy established the first formal requirements for nursery schools serving children aged 0 to 3. Using administrative data and regional variation in implementation, I find that the reform raised childcare quality by 0.10 standard deviations but reduced availability by 48%. Maternal employment fell by 15%, meaning mothers were 11 percentage points less likely to work after childbirth, with working intensity declining by 14 percentage points. Effects concentrate among private-sector workers with less flexible jobs; fathers were unaffected. Unlike prior work examining quality or quantity separately, this paper provides the first joint analysis revealing that quality regulations without preserving availability harm working mothers.