A Regional Comparative Static CGE Analysis of Subsidized Child Care

29 Pages Posted: 11 Dec 2007

See all articles by Dan S. Rickman

Dan S. Rickman

Oklahoma State University - Stillwater - Department of Economics & Legal Studies in Business

Mark C. Snead

Oklahoma State University - Stillwater - Department of Economics & Legal Studies in Business

Abstract

Concerns with the equity of societal income distribution typically underpin the provision of government subsidies to low-income households, in which such subsidies are commonly believed to reduce economic growth. Using a regional computable general equilibrium (CGE) model, this study examines the equity and growth aspects of subsidizing formal child care services for low-income households at the state level. The results suggest that state government subsidization of formal child care services does not necessarily reduce the level of economic activity, even when accounting for negative growth effects of tax increases required to finance the subsidies. The CGE model also reveals economic impacts on households and industry sectors not directly affected by the subsidies, impacts that would be omitted from a partial equilibrium microeconometric appraisal.

Suggested Citation

Rickman, Dan S. and Snead, Mark C., A Regional Comparative Static CGE Analysis of Subsidized Child Care. Growth and Change, Vol. 38, No. 1, pp. 111-139, March 2007. Available at SSRN: https://ssrn.com/abstract=1061843 or http://dx.doi.org/10.1111/j.1468-2257.2007.00355.x

Dan S. Rickman (Contact Author)

Oklahoma State University - Stillwater - Department of Economics & Legal Studies in Business ( email )

201 Business Building
Stillwater, OK 74078-0555
United States

Mark C. Snead

Oklahoma State University - Stillwater - Department of Economics & Legal Studies in Business ( email )

201 Business Building
Stillwater, OK 74078-0555
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
16
Abstract Views
698
PlumX Metrics