National targets vs. Local actions: analyzing Italian municipalities’ childcare provision choices with a sample-selection-corrected classification model

Abstract

In decentralized countries, policies designed at the central level are frequently assigned to local governments for implementation. The central government sets the targets to be achieved and provides the funding, while local governments can decide whether, and to what extent, they participate in these programs. A recently launched program in Italy in the field of childcare follows this general framework. The central government allocated additional grants to municipalities, earmarked for the enhancement of nursery services, consistent with a national target. Individual municipalities utilized these funds to varying extents. This paper aims to investigate the key determinants of the choices made by different municipalities. We employ a sample-corrected model to account for the fact that only a set of municipalities received additional resources. The estimation process shows that demand-side factors and technological factors are the most relevant in explaining the different choices made by municipalities. The results suggest that the program design should be better tailored to the specific characteristics of the local environment to implement a more gradual activation of childcare services.