SELF-EMPLOYMENT AND PROVIDING CHILD-CARE

This paper considers self-employment and providing child care as occupational strategies that can lower the cost of child care. If the ability to care for one's own children while engaged in market work is important to mothers with young children, we predict that women with young children will be more likely to choose to be self-employed or to be a child care provider than women without young children. The analysis provides strong support for this hypothesis. The results show that the presence of young children is an important factor in choosing self-employment and in choosing to be a child care provider. Finally, simulations are presented which show that a woman's choice among these sectors is quite sensitive to the number and ages of her young children.