Is longer maternal care always beneficial? The impact of a 4-year paid parental leave

Abstract

We study the impact of an extension of paid family leave in the Czech Republic from 3 to 4 years on children’s long-term outcomes. We find that an additional year of maternal care at age 3 has an adverse effect on children’s human capital investments and labor market attachment. Affected children are 6 percentage points less likely to be enrolled in college and 4 percentage points more likely to be not in education, employment, or training (NEET) at age 21–22. While the negative impact on education is persistent, with an 8 percentage points lower probability of completing college by the age of 27, the effect on NEET is short-lived. The results are driven by children of low-educated mothers, whose education and NEET outcomes are affected by as much as 12 percentage points. Our findings are consistent with previously documented positive effects of universal childcare on child long-term outcomes and with the fact that the extended maternal care induced by the extension of family leave led to a postponement of public kindergarten enrollment.