The Economics of Childcare

Paper Summary:

This paper explains that childcare, like other goods and services, is a commodity, which is bought and sold in "the market". The author points out that the increase in the number of women in the workforce, the decline of the extended family located near nuclear families and the high divorce rate are trends, which have increased the demand for childcare services. The paper relates that planning and operations issues of childcare companies can be affected by changes in interest, inflation, and unemployment rates, which influence macroeconomic forecasts.

Table of Contents
Introduction
The Product and Services
Strategies Used to Increase Revenue
The Demand for Services/Market Structures
Issues Affecting Consumer Demand and Price
Economic Forecast Component
Explanation for Economic Forecasts Variations
Implications of Forecasts on Planning and Operations
Conclusion

From the Paper:

"This facility offers a variety of quality services that most childcare facilities do not offer. Quality has a seven-point scale, with a range from inadequate, to mediocre, to excellent. This index is used widely in early childhood literature to gauge the quality of the services produced at childcare centers. The quality-adjusted cost functions for childcare centers were estimated and it was discovered that an elasticity of cost with respect to (process) quality. By these estimates, it would cost $243 to $324 per child per year (in 1993 dollars) to increase the quality of childcare services from "mediocre" to "good." The estimated marginal cost of quality was similar. The facility offers additional services such as weekend workshops for parents and children, On-Call/After-hours instructor availability, Progress Reports, Parents night out childcare, and Field Trips. Most often parents do not have time to stop and play with their children at drop off or pick up time. In many cases, only one parent drops off and picks up the child so one parent rarely visits the facility and instructors. Weekend Workshops allow parents and children to explore together, and at the same time promote our program to potential families. This feature generates additional income through community parenting workshops as well."

More papers on The Economics of Childcare:

• Research Paper # 7431 : "Childcare in the United States"
• Argumentative Essay # 65024 : "Divorce and the U.S. Government"
• Research Paper # 75081 : "Deconstruction of Business Ethics "

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