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

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.