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DIW Economic Bulletin

42 / 2017 Day Care Centers: Family Expenditures Increased Significantly at Some Points between 1996 and 2015 Sophia Schmitz, C. Katharina Spieß, Juliane F. Stahl S. 411-423

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Abstract:

Private household expenditures on child care in centers have significantly risen: from an average of 98 euros per month in 2005 to just under 171 euros in 2015 for a child under three and for children three and older (“Kindergarten”1 age group), from 71 to 97 euros in the period between 1996 and 2015. At the same time, more and more households are completely exempt from paying fees for day care. However, relative to their income, households on or below the poverty line that have day care expenditures still pay virtually the same amount as other households. For the first time, based on data from the Socio-Economic Panel (SOEP) and the special study Families in Germany (FiD), the present report shows trends in day care expenditures in recent years and who is carrying how much of a burden as a result. Lower income households and single parents in the Kindergarten age group have been affected to a lesser extent or not at all by increases in day care expenditures over the years. Nevertheless, in the future progressive fee scales should be implemented more thoroughly and, above all, uniformly throughout the federal states. It is not necessary to make day care universally free of charge because households in upper income groups have expressed a high willingness to pay. This potential has not been fully utilized and could be enhanced—especially if public money is used to improve day care quality.

JEL-Classification:

I24;I28;J13;I22

Keywords:

child care, early education, day care fees, socio-economic differences, child costs