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This paper assesses the impact of a reduction in childcare costs, resulting from a change in compulsory schooling law, on mothers' labour supply in Turkey.

The 2012 Education Reform lowered the school starting age, allowing children up to 60 months old to enrol in primary schools. Previously, the starting age was seven years old, corresponding to 72-month-old children. We consider this change as an implied childcare subsidy for mothers with eligible children and investigate its labour market consequences. Using Turkish Household Labour Force Surveys, we applied a differences-in-differences method to estimate the effect of this law on mothers' labour supply.

The results reveal that the reform did not alter mothers' labour supply behaviour, even when categorized by educational attainment and marital status. While the findings for married mothers align with previous literature, the results for single mothers, despite showing a positive magnitude, are not statistically significant.

Previous literature shows a strong correlation but limited causal evidence on childcare subsidies and maternal labour supply in Turkey. This study is the first to use a change in compulsory schooling law to provide causal evidence. The results suggest that mothers in developing countries may respond differently to subsidies than those in developed countries, especially when there is an extensive informal childcare market. Policymakers should consider this when addressing mothers' behavioural inertia.

The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-02-2024-0110