Since early childcare plays an important role in the development of cognitive skills, it partially determines success later in life. What improves cognitive ability and behavioral development at a young age is therefore of crucial policy importance.
While early psychological theories have stressed the need for maternal care, more recent studies in psychology as well as in sociology and economics show that other childcare arrangements do not necessarily produce negative outcomes. Two of the most common alternatives to parental care are support by the grandparents and formal care centers.
In a new IZA Discussion Paper, Daniela Del Boca, Daniela Piazzalunga and Chiara Pronzato analyze the influence of these arrangements on the development of the child. Using data on 10,000 babies born in the UK in 2000 and 2001, the researchers find that children cared for by grandparents are better at naming objects, but perform worse in tests concerning basic concepts development, problem-solving, mathematical concepts and constructing ability than children in formal care.
Concerning school readiness at age three, the authors observe a positive effect of formal care centers, while more hours spent with grandparents have a negative influence. Also the positive effect on grandparents’ support on vocabulary at age three vanishes when the children become five years old.
Nevertheless, these results hide strong heterogeneities: The positive association between grandparents’ care and child outcomes is stronger for children growing up in more advantaged households (higher income and education) while the negative association is significant only for children in more disadvantaged households (lower income and education).