Market constraints on child care quality

This article uses the data from Cost, Quality and Child Outcomes in Child Care Centers, The Study of Children in. Family Child Care and Relative Care, and the Economics of Family Child Care Project to argue that most child care in the United States today is mediocre or worse and that this mediocrity is the result of supply and demand conditions in the market for child care. Imperfect knowledge on the part of suppliers and researchers about how to efficiently provide good care limits quality. More important, monopolistic competition with a broad range of modes of care, each with different cost structures, forces centers without subsidies to cut their costs in order to compete. Many parents cannot afford the cost of high-quality care, and even those who can afford it have trouble identifying it. Policy to improve quality needs to be multifaceted. Regulation, incentives, and training will help providers who either do not care ab out quality or do not understand how to create it. Subsidies are needed for parents who cannot afford the cost of quality care. Information and ratings of providers will help the parents who cannot identify quality or do not appreciate its importance.