Daycare Matching with Siblings: Social Implementation and Welfare Evaluation

2026-04-15

AI Summary

This study addresses the inefficiency and welfare bias in existing childcare assignment mechanisms, which overlook families’ preference for enrolling siblings together. The authors develop a structural model incorporating sibling complementarities in childcare placement and, using administrative data from a Japanese municipality, provide the first empirical quantification of the additional commuting costs and fixed non-distance disutilities incurred when siblings are assigned to different facilities. Counterfactual simulations evaluate the welfare and equity impacts of alternative sibling priority policies. The findings reveal that the sibling priority policy implemented in 2024 increases aggregate welfare by 6.4% while reducing inequality; however, a welfare-maximizing policy would exacerbate inequality—each 100-meter increase in average travel distance corresponds to a 1.7-percentage-point rise in the Gini coefficient. This work offers empirical evidence and a design framework for childcare allocation reforms that balance efficiency and equity.

Technology Category

• Game Theory and Economic Paradigms: Fair Division
• Planning, Routing, and Scheduling: Scheduling under Uncertainty
• Search and Optimization: Combinatorial Optimization

Application Category

• Economics, Online Markets and Human Computation: The sharing economy
• User Modeling, Personalization and Recommendation: Fairness-aware retrieval and ranking
• Security and Privacy: Large-scale security measurements

Abstract

In centralized assignment problems, agents may have preferences over joint rather than individual assignments, such as couples in residency matching or siblings in school choice and daycare. Standard preference estimation methods typically ignore such complementarities. This paper develops an empirical framework that explicitly incorporates them. Using data from daycare assignment in a municipality in Japan, we estimate a model in which families incur both additional commuting distance and a fixed non-distance disutility when siblings are assigned to different facilities. We find that split assignment generates a large disutility, equivalent to more than twice the average commuting distance. We then simulate counterfactual assignment policies that vary the strength of sibling priority and evaluate welfare. The sibling priority reform that we designed and that was implemented in 2024 increases welfare by 6.4% while reducing inequality in assignment rates across sibling groups; models that ignore sibling complementarities substantially understate these gains. At the same time, we uncover a clear efficiency-equity tradeoff: along the frontier, increasing mean welfare by 100 meters is associated with an increase in inequality of about 1.7 percentage points, and the welfare-maximizing policy reverses much of the reform's reduction in inequality, largely through the displacement of households without siblings.

Problem

• daycare assignment
• sibling preferences
• complementarities
• welfare evaluation
• equity-efficiency tradeoff

Innovation

• complementarities
• sibling priority
• welfare evaluation
• centralized assignment
• empirical framework