The Impact of Rural Hospital Closures on Public Prekindergarten Enrollment

• In Event: Early childhood care and education enrollment: Policy drivers and impacts

Abstract

Access to early childhood education (ECE) has been shown to increase maternal labor force participation (Sall, 2014; Ilin et al., 2022). There are no studies to date, however, which examine whether a reverse relationship exists between labor force participation and enrollment in ECE, i.e., can decreased labor force participation decrease enrollment in ECE?

In this paper, I leverage data on rural hospital closures, which have been shown to have negative impacts on local economies including labor force participation (Malone et al., 2022), to explore the theorized relationship between a reduction in labor force participation and ECE enrollment using a difference-in-differences approach. I specifically look at public school prekindergarten enrollment as an outcome since school-level data on enrollment is readily available and easily linked with county-level data on rural hospital closures. 

All analyses are conducted on a panel dataset of US rural counties from 2000 to 2019. I collect data on public prekindergarten and kindergarten enrollment from the National Center for Education Statistics (NCES, 2021). From these data, I construct an outcome variable that measures the rate of public prekindergarten enrollment in a given county in year t relative to kindergarten enrollment in the following year (t + 1). I link these outcome data to a database of rural hospital closures from the North Carolina Rural Health Research Program (2025) using county-level Federal Information Processing Standards (FIPS) codes.

Because hospital closures occur at multiple time points, I employ the approach outlined by Callaway & Sant’anna (2021) to generate group-time average treatment effects for each treatment cohort at each period of observation, aggregating group-time treatment effects to generate an overall estimate of the effect of rural hospital closures on public prekindergarten enrollment. I test the key identifying assumption for DD, parallel trends, by visually analyzing trends in the pretreatment time period using an event study.

I find that hospital closures overall have a negative effect on prekindergarten enrollment of 2.7 p.p. (robust std. err. 1.6 p.p.; p<.10), which is marginally statistically significant when aggregating effects across all treatment periods. Looking at closures of specific types of hospitals, there was a significant negative effect for closed hospitals that participated in Medicare’s Prospective Payment System (PPS), with closure of these hospitals leading to an average decrease in prekindergarten enrollment of 6 p.p. (robust std. err. 1.7 p.p.; p<.001) relative to counties without hospital closures. I also examine heterogeneity in treatment effects over time and by cohort and explore mechanisms, including the hypothesized reduction in labor force mechanism, which findings generally support.

Future analyses include further explorations of alternative potential mechanisms and a variety of sensitivity analyses and robustness checks.

Author

• Easton Stone Dawson, Vanderbilt University
  Presenting Author