Competition and childcare quality: Evidence from Quebec

Since 1997, the Canadian province of Quebec has put in place a heavily subsidized universal childcare program for all children under the school age. The present paper examines how the level of competition among individual providers associates with the quality of childcare in Quebec. The quality of childcare is measured by the number of violations and penalties recorded in the inspections conducted by the Quebec Ministry of Family Affairs. The analysis indicates that the intensity of parental competition for daycare spots, as opposed to childcare centres' competition to attract parents, negatively associates with the quality of childcare. Critically, this association is mainly driven by less affluent neighbourhoods. In addition, these associations are found to be stronger for more serious violations. The policy implications for both childcare quality and childcare equality are discussed.