The Effect of Child Care Subsidies: A Critique of the Rosen Model

  title={The Effect of Child Care Subsidies: A Critique of the Rosen Model},
  author={Iulie Aslaksen and Charlotte Koren and Marianne Stokstad},
  journal={Feminist Economics},
  pages={103 - 95}
In an influential article, Sherwin Rosen (1997) argues that Swedish subsidies of child care services lead to a substantial misallocation of resources that slows economic growth. We offer two major reasons why Rosen's approach is flawed. First and foremost, he ignores the positive externalities of increasing the quality of child care, despite their clear relevance to his general equilibrium model. Second, he overlooks distributional impacts, despite evidence that child care subsidies… 
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