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Joint custody law and mothers’ labor market outcomes: evidence from the USA

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Abstract

This paper studies the economic implications for 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 the joint custody reform across states provides a natural experimental framework to study the causal effect of shared custody on mothers’ economic outcomes. The results show that only single mothers experience a decrease in earnings as a consequence of the adoption of the joint custody law, exposing them to a higher risk of poverty. The paper discusses a possible explanation for these findings, namely that the higher child support payment the mother receives from the non-custodial father in case of joint custody might discourage her from looking for high paid jobs or investing in her career.

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Notes

  1. In the “tender years doctrine,” children were no longer viewed as economic assets or as workers under the control of their fathers; instead they came to be seen as individuals with their own needs and in the case of young children, they were recognized to have special needs for nurture, normally satisfied by the mother. Current laws do not give special attention to child nurture and do not recognize the importance of developmental stages. In other words, two-year old children are treated the same as children of twelve.

  2. Utah is a typical example of inconsistency between state statutes and case law. Although the explicit maternal presumption was repealed by the legislatures in 1977, the courts continued to practice maternal preference toward mothers in child custody cases until 1986; the judicial preference in favor of the mother was explicitly abolished in the case Pusey v. Pusey in 1986 (Chen 2013).

  3. Nearly all the adopted states have distinguished in their legislation between legal and physical custody. Legal custody refers to the parental right to make major decisions regarding child’s health, education, welfare etc. Physical custody refers to the living arrangement of the child on a day-to-day basis. In states permitting or encouraging joint legal and physical custody arrangements, it is difficult to determine what percentage of parents have joint legal or physical custody, as the data must be obtained from individual divorce decrees. For this reason no distinction is made between the two in this analysis and the child custody reform that is examined is meant to capture the overall change to both types of joint-custody arrangements.

  4. 4Allen and Brinig (2011) found that joint parenting in Oregon led to changed custody arrangements, but it came through changes in sole and split custody (some of the children living with one parent, and some of the children living with the other parent) and not in joint custody. However, these results should be interpreted with caution since they only refer to one state and are based on a before/after approach.

  5. Possible reasons for the difference in findings between the two studies could be attributed to differences in the definition of divorce rates, in the time window and in the functional form of their estimation models.

  6. The differences between Halla (2013) and Nunley and Seals (2011) and Altindag et al. (2015) might be explained by the different sample selection and estimation procedure.

  7. Recently, two studies have examined the effect of the introduction of the gender-neutrality in the US, according to which fathers have equal rights to custody at divorce. Chen (2013) shows that gender-neutral laws increases divorce rates in the long run, while Rose and Wong (2014) finds that the gender-neutral law decreases the hazard into marriage. Rose and Wong (2014) also investigate the subsequent move toward marriage neutrality, which extends to unmarried fathers the possibility to gain sole custody if they qualify as a suitable custodian. They find no evidence of a reform effect on marriage rates.

  8. The 1960 Census sample is included to allow for a credible identification of preexisting state specific trends (Gruber 2004; Wolfers 2006).

  9. Stepmothers are excluded since the census questions identifying this group changed in 1990. Moreover, remarried families have many confounding effects that make the impact of joint custody less clear-cut. Widowed mothers—who represent a very small fraction of the population (only 0.2%) mainly due to the selection of relatively young women in the sample—are excluded. As expected, the inclusion of this group in the sample does not change the results.

  10. Results related to the “other income” variable should be interpreted with caution since this variable is not perfectly comparable across years. As reported in the IPUMS documentation (see Ruggles and Sobek (1997)), in 1960 respondents were simply asked to declare the amount of money income received from sources other than wages and self-employment. Beginning in 1970, other possible sources of additional income, such as the sale of personal property, lump-sum insurance and inheritance payments, payments “in kind”, veterans’ payments, unemployment compensation, child support, and alimony were added to the list of excludable variables. The exclusion of the year 1960 does not change the results.

  11. The variable “being on welfare” includes federal/state Supplemental Security Income (SSI) payments to elderly (age 65+), blind, or disabled persons with low incomes, Aid to Families with Dependent Children (AFDC) and General Assistance (GA).

  12. Unfortunately, it was not possible to use the number of hours worked because this variable is not collected throughout the Censuses.

  13. 13Brinig and Buckley (1998) provided another code for joint custody but it is update only up to 1993. For this reason this paper prefers the coding proposed by Teng (2008), who has nevertheless proved his results to be robust to the use of the Brinig and Buckley’s coding.

  14. The analysis uses the more restrictive coding but the results are unchanged if the other rule is considered. Results are available on request.

  15. This approach has been used extensively in the literature investigating the consequences of introducing the unilateral divorce law (see Gruber2004; Friedberg1998; Stevenson2007 and 2008; Stevenson and Wolfers2006, Wolfers2006, among others). The same approach has been used to study the consequences of adopting the joint custody law on several outcomes (see Halla2013; Teng2008; Böheim et al. 2012 and 2016; Altindag et al. 2015; Nunley and Seals2011; Allen et al. 2011; Rose and Wong2014; Chen2013). For a general overview of the difference-in-difference models see Angrist and Pischke (2009) and Wooldridge (2003).

  16. As pointed out by Nunley and Seals (2011) for example, the increase in female labor force participation rate and fathers’ involvement in childrearing could be correlated with the passage of joint-custody reform. Failure to account for these state-level covariates could bias the estimates. However, fixed trend models are quite demanding when using census data because there are few time-series observations (in this case only five). Moreover, trends measuring decade time windows will not be able to capture the short-run endogeneity, but only the long-term one (Gruber 2004; Angrist and Pischke 2009).

  17. Unilateral divorce, which allowed divorce with the consent of just one rather than both spouses, was rare before the late 1960s, but it was in place in most states by the mid-1970s. Of the 50 states, in 2006, five had yet to adopt any form of unilateral divorce.

  18. 18Altindag et al. (2015) use a different strategy to control for possible selection effects. They examine a sample of married couples who wed before 1977, i.e., before the widespread adoption of joint custody law across states. For those couples, the decision to marry should not be influenced by the passage of joint custody law because it was not in place. The estimates based on the restricted sample do not differ from those on the full sample confirming that selection is not an issue in the custody reform context. A similar approach has been adopted by Böheim et al. (2016) who restrict the sample only to marriages formed before the reform. Halla (2013) restricts the sample to married women and obtain similar results to the whole sample of women, supporting again the hypothesis that selection into marriage is not an issue. Unfortunately, it is impossible to adopt the same strategy in this paper because the year of marriage is not recorded in the IPUMS data.

  19. In the interest of preserving space, only the coefficients on joint custody are reported.

  20. The different pattern of the results between this study and Halla (2013) can be easily reconciled. If one computes the difference between the labor force participation of all women and the labor force participation of married women reported in Table 6 of Halla (2013), this gives the effect for single women which is approximately constant over time.

  21. States can be divided into three groups according to the property division regime: common law property, community property, and equitable division. In a common law regime, marital property is divided at divorce according to who has legal ownership of the property; in a community property regime, most property acquired during the marriage (except for gifts or inheritances) is owned jointly by both spouses and division of community property under divorce may take place by item, by splitting all items or by value; finally, in a equitable division regime, judges have discretion in allocating marital property according to what the judge deems as fair. In equitable division states, judges can act more discretionally in property allocation than in common law or community property states (Gray 1998). Moreover, community property states are considered as transferring more assets to the wife after divorce than in common-law jurisdictions since household assets tend to be held in most cases in the husband’s name (Gray 1998).

  22. The divorce coding proposed by Gruber (2004) has been used, but the results are virtually unchanged if the one proposed by Friedberg (1998) is instead used. The main difference between the two is that Gruber considers as “non-adopting” the states that have unilateral divorce and separation requirements (New Jersey, Ohio, Pennsylvania, South Carolina, and the District of Columbia). Results available upon request.

  23. Three states (Massachusetts, Missouri and Montana) shifted from common law property division to equitable division over the period. Equitable division is included as control, common law is the excluded category and community property is omitted because of collinearity with state fixed effects.

  24. The results are unchanged if all the eight measures are included instead of the single index or if the single index is computed through a factor analysis and taking the first principal component. Results available upon request.

  25. It is assumed that children were born before the divorce took place, which seems a reasonable assumption.

  26. All the income variables are expressed in 1999 dollars.

  27. Some unobserved characteristics may affect both joint custody and the financial involvement of nonresident parents. Parents who choose joint custody are different from those who do not in terms of disagreement on post-divorce child-rearing decisions or conflictual relationship between partners. Here a 2SLS strategy is used to adjust for such unobserved characteristics in order to have unbiased estimates of joint custody (Seltzer1991, 1998). Following Seltzer (1998), the average percentages of joint custody in each state are used as an instrument for actual joint custody. The effect of the percentage of state joint custody (either legal or physical) on observed joint custody is of the expected sign and strongly significant. This represents our first stage regression. As one might expect, parents who live in states with a higher percentage of joint custody are more likely to share child custody. Results from the 2SLS regressions are very similar in size to those reported in Table 7 even if mainly not significantly different from zero due to the high standard errors (results available on request). The Hausman test of equality between OLS and IV does not reject the null hypothesis of no differences between OLS and 2SLS estimates.

  28. Potentially, the results might also be explained by the fact that joint legal custody places more restrictions on the residential parent than sole custody does. Courts may restrict the geographic area in which a parent lives as part of the custody order, or they may deny a subsequent request for permission to move if it is viewed as an attempt to hinder the other parent’s visitation. To shed some light on this channel, this study investigates if divorced/separated mothers are less able to move under joint custody than under sole custody. Using the CPS-CSS data and the same sample of Table 7, it is found that mothers awarded joint custody do have the same probability of moving than mothers with sole custody. Moreover, there is no evidence that joint custody places restrictions on career investment since divorced/separated mothers with joint custody have a higher probability of being employed, earn more and rely less on welfare.

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Acknowledgments

I thank Josh Angrist, Erich Battistin, and Sascha Becker for helpful discussions. I also thank two anonymous referees for their help and guidance. The author is responsible for all errors and omissions.

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  1. Department of Economics and Finance, University of Rome “Tor Vergata”, CEIS, CESIfo and IZA, Via Columbia 2, 00133, Roma, Italy

    Daniela Vuri

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Appendix

Appendix

Table 8 Year of introduction of joint custody, divorce laws, and child support enforcement variables and types of marital property laws
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Vuri, D. Joint custody law and mothers’ labor market outcomes: evidence from the USA. J Popul Econ 31, 1203–1237 (2018). https://doi.org/10.1007/s00148-017-0680-x

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