Joint Custody Laws and Mother's Welfare: Evidence from the US

Abstract

Recent research has focused on the consequences on the unilateral divorce laws on several aspects of individual behavior but the issue of children custody after divorce has been almost neglected. This paper studies the implications on mothers of the changes in child custody law from maternal preference to joint custody using the 1960-2000 Census Public Use Micro Sample (IPUMS). Variation in the timing of joint custody reforms across states provides a natural experimental framework to study the causal effect of shared custody on mothers' economic outcomes. We also study the heterogeneity of the effect according to the years of exposure and to the age of the child at the time of the reform. The results show that divorced/separated mothers are negatively affected by the adoption of the joint custody laws in terms of a decrease in total income and earnings, exposing them to a higher risk of poverty. The paper discusses a possible rationale for these findings in terms of higher child support payments the mother gets from the non custodial father in case of joint custody which might discourage them from looking for high paid jobs or investing in their careers.

Keywords: joint custody laws, bargaining, difference in difference

JEL Classification: J12, J13