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The effects of lengthening the school day on female labor supply: Evidence from a quasi-experiment in Chile

In 1996, the Chilean government approved the extension of the school day, increasing the amount of time that students spend at school by 30%. Using data from the Chilean socio- economic household survey and administrative data from the Ministry of Education for 1990- 2006, we exploit the quasi-experimental nature of the reform’s implementation by time and region in order to identify the causal impact of the program on labor participation, employment and hours worked for women between 20 and 65 years old. The identification strategy relies on a fixed effect model of repeated cross-section. The results show a positive and significant effect on labor participation and female employment in all age groups and a negative and statistically significant effect on the number of hours worked. The main conclusion of this study is that the implicit childcare subsidy induced by the program had a positive and significant impact on the labor supply of women in Chile.