Cash-for-Care Use and Union Dissolution in Finland.

Kathrin Morosow,Juho Härkönen,Marika Jalovaara

doi:10.1111/jomf.12738

Kathrin Morosow, Juho Härkönen + Show 1 more

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https://doi.org/10.1111/jomf.12738

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Abstract

ObjectiveThis study examines how the receipt of the cash‐for‐care (CFC) benefit affects short‐ and long‐term risks of union dissolution.BackgroundSeveral theories predict that couples' gendered division of labor decreases their risk of separation, either due to increased partnership satisfaction or because it establishes economic dependency. Family policies such as the Finnish CFC benefit, which is paid if a young child does not attend public daycare, may encourage such a gendered division of labor, at least temporarily.MethodUsing Finnish register data, this study analyzes the first childbearing unions of 38,093 couples between 1987 and 2009. Discrete‐time event history analyses and fixed effects models for nonrepeated events are applied.ResultsThe results suggest a lower separation risk while the benefit is received as compared to couples who do not use it, but no effect in the long‐term. Fixed effects models that control for selection into CFC indicate postponement of separation until after take‐up. Higher‐income mothers show a stronger postponement effect, possibly due to greater income following leave.ConclusionCFC use, which signals a temporary gendered division of labor and losses in mothers' earnings, predicts a lower separation risk during receipt of the benefit, but not beyond.ImplicationsPolicies that affect the division of paid and unpaid labor at best only temporarily reduce dissolution risks.

Highlights

Policies have various aims, such as the promotion of maternal employment, the compatibility of family life and paid work, gender equality, child development, and poverty reduction
The cash-for-care benefit (CFC) policy indirectly promotes a gendered division of labor within couples and leads to longer periods out of the labor market that can result in loss of economic and human capital
The results from the regular models without fixed effects show that, net of the effects of all control variables, separation rates are lower while CFC is received, but there is no effect in the years following the take-up

Summary

Introduction

Policies have various aims, such as the promotion of maternal employment, the compatibility of family life and paid work, gender equality, child development, and poverty reduction (see e.g., Mätzke & Ostner, 2010; Thévenon & Gauthier, 2011). There are theoretical reasons to expect that by affecting either maternal employment, the couple’s division of labor, or family income, such policies may affect family stability. By subsidizing family-based childcare, CFC decreases the labor supply of mothers of young children (Hardoy & Schøne, 2010; Kosonen, 2014), and promotes a gendered division of labor between partners. It is a controversial policy in a country where men’s and women’s employment rates are otherwise similar, and it contradicts other policy aims to promote gender equality and maternal employment (Duvander & Ellingsæter, 2016). One study conducted in Norway analyzed the effects of CFC on family stability and found that the introduction of the CFC policy lowered divorce rates during the first 3 years after childbirth (Hardoy & Schøne, 2008)

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