The effects of child custody and support policy outcomes on male employment and labor supply in the United States

Abstract

Even as researchers have examined the impact of child support law and policy on male labor supply and even as economist have consistently shown that marriage and child custody are associated with increases in male labor supply, no study has ever quantitatively examined the effects of the loss of custody on male employment or labor supply. This study utilizes a social framework that treats marriage, child custody and support as built on a set of transactions that are entered into voluntarily and that motivate men to produce more than they otherwise would. Similarly, when men become fathers out of wedlock or become noncustodial parents as a result of divorce or as a result of cohabiting arrangements breaking down, these transactions become truncated. We hypothesize that this will have an unambiguously negative effect on male employment. The study employs data from the Survey of Income and Program Participation (1996 and 2004 Panels) to measure the statistical relationships and effects of marriage, divorce, custody and child support on male labor supply. The results of this study suggest that marriage and custody increase male labor supply, while loss of custody decreases male labor supply, and being under a child support order counteracts the negative effects of the loss of custody. All of these effects are most pronounced among the least educated. Ultimately, this study suggests that law and public policy put more emphasis on enforcing contact between noncustodial fathers and their children, and that over the longer-term American society re-examine how it decides custody in divorce and out-of-wedlock birth situations.