Concerns are on the rise over the quality of child care as reports of child abuse increase across Korea. And while the majority of parents prefer public child care centers, it has been found that the probability of abuse in such centers is higher than in private facilities. Abuse cases have been reported even at top-tier centers, raising doubts over the effectiveness of the evaluation and accreditation system.

Under the circumstances, this study analyzed the effects of the ratio for the capacity of child care centers (all types) and accredited centers to total resident child population (hereinafter capacity ratio) on maternal employment and use of child care, using panel data from the Korean Longitudinal Survey of Women and Families. In cases where the parents are comparatively satisfied with the public centers and accredited facilities in their area, women were more likely to participate in economic activities or use child care centers if the capacity of the public and accredited centers was larger than the population of resident children. During the data-analysis period, the evaluation and accreditation system was applied only to child care centers, not kindergartens, and as the care service for the 0-2 age group is available only in child care centers, this study used panel data on women with children aged 0-2.

Preceding studies have stated that parents’ decision to participate in economic activities and to use care centers is affected by the cost and supply of child care services. Simply put, even if the cost is low, maternal employment or care center use will only rise if the supply of care services is sufficient. Accordingly, this study also looked at the data on the relationship between local governments’ limit on necessary expenditure and maternal employment and use of child care. The fees that parents pay to child care centers consist of care costs and necessary expenditures, and while the former is determined by the household’s economic status, children’s age, survey year and employment status of the parents, the latter is wholly borne by the parents.

The empirical analysis found that the average of the probability of child care use did not change when the center’s capacity ratio increased in a residential area but decreased when the monthly limit of necessary expenditures rose. The average of the probability of maternal employment was found to have no affect on the center’s capacity ratio, while it decreased when the monthly limit of necessary expenditures rose. Similar results were obtained when the capacity ratio of centers was analyzed in terms of their establishment and accreditation types. The results suggest that women with children aged 0-2 tend to stay away from maternal employment or child care even if the capacity ratio of public centers and accredited facilities increases in their residential areas. This appears to be due to the fact that the high quality care expected from parents is not yet generally available in spite of their significantly reduced child care costs following the adoption of free child care programs. To effectuate improvements in maternal labor force participation through the supply of child care, efforts should go beyond cutting costs, and qualified high―tier facilities should be made affordable to parents. On the other hand, the monthly burden of necessary expenditures of parents has had an adverse effect on decisions over maternal employment as well as the use of child care centers. Thus, plans should be developed to expand the number of desirable centers while also upgrading the quality of overall care and seeking measures to reduce parents’ financial burden. If proper child care service is provided at a reasonable price, it could incentivize women to engage in economic activities and ease their concerns over child safety and development.

Based on these analyses, this study presents suggestions on improving the quality of child care and reducing the burden of necessary expenditures with regards to setting child care fees; parental participation in operating child care centers; the process of evaluating and accrediting centers; requirements for establishing child care centers and; the autonomy in operating child care programs and the Nuri curriculum.

Preface
Executive Summary

Chapter 1 Introduction

Chapter 2 Overview of Child Care Policies
　Section 1 Types and Usage of Child Care Centers
　Section 2 Evaluation and Accreditation of Child Care Centers
　Section 3 Licensing Restrictions for Child Care Centers
　Section 4 Child Care Fees and Necessary Expenditures

Chapter 3 Analysis of Women’s Economic Activity and Child Care Utilization
　Section 1 Literature Review
　Section 2 Data for Empirical Analysis
　Section 3 Methodology for Empirical Analysis
　Section 4 Results of Empirical Analysis

Chapter 4 Conclusion and Policy Recommendations
　Section 1 Adjusting the Scope of Free Child Care and Fee Ceilings
　Section 2 Strengthening Parental Participation in Fee Determination
　Section 3 Enhancing the Evaluation and Accreditation of Child Care Centers
　Section 4 Promoting Quality-Based Competition and Reducing Enrollment Pressure
　Section 5 Increasing Autonomy in Child Care Programs and the Nuri Curriculum

References
Appendix
ABSTRACT