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The quality of child-care centers and preschools—situated in a mixed market—varies enormously. Advocates for higher quality urge higher subsidies and stricter central regulation. Market advocates argue instead that local demand and parental-choice remedies will spark quality gains while ensuring competitive prices. Federal and state governments have responded with an array of policy interventions: targeting subsidies on preschools serving low-income families; enacting statewide quality standards; creating tax credits and vouchers for the “working poor” and middle-class families. This article assesses the influence of these alternative policies on preschool quality, based on a national survey of 1,805 centers in 36 states. Discrete policy effects are assessed after taking into account the influence of contextual sources of family demand: statewide levels of wealth, maternal employment, and poverty rates. Contrary to K–12 patterns, we find that center quality is higher in centers receiving greater subsidies. However, the subsidy effect depends on the particular indicator of quality being observed; effects are also conditioned by state-level contexts. Statewide sources of family demand, antecedent to policy interventions, help to raise certain facets of preschool quality. Tax credits hold no discernible influence on quality. Implications for building policy strategies in “managed choice” school settings are discussed.
Fuller et al. (Wed,) studied this question.