What influences the size of child maintenance payments? A register‐based study of maintenance payments in Finland

Abstract

The aim of this study was to explore how particular economic and demographic factors contribute to the level of the child maintenance payment (CMP) paid by the non‐resident parent. For this study, we used 5‐year longitudinal panel data from years 2009 to 2013 consisting of over 80,000 non‐resident parents from the Finnish Tax Administration and The Finnish Population Register Centre. Results from regression models indicate that the single biggest factor affecting the size of CMPs is the number of dependent children. We found that the non‐resident parent's higher income is associated with higher CMPs and that non‐resident fathers pay on average larger CMPs than non‐resident mothers, even after accounting for differences in income. Unexpectedly, we found that the age of the dependent child did not predict changes in CMPs. This suggests that once formal CMP‐contracts are determined between the parents, they are seldom changed. Our results suggest that some degree of mandatory periodic review for maintenance contracts is worth considering.