This paper studies the determinants of partnership dissolution and focuses on
the role of child support. We exploit the variation in child support liabilities and
entitlements driven, in part, by the introduction of a new set of complex rules that
determined child support liability, and by their interaction with welfare rules. Our
sample has the virtue that the post 1992 variation in child support liability for all
couples in partnerships formed prior to 1992 is unanticipated. We find strong
evidence that the resulting large child support liabilities significantly reduced
dissolution risks. Simulations based on our results suggest that child support criteria
that are driven only by the non-custodial parent’s income, compared to criteria driven
by the aggregate incomes of both parents, would imply much smaller separation
rates. |
