Permitting the Compensation of Birth Mothers for Adoption Expenses and its Impact on Adoptions

Document Type

Article

Publication Date

7-1-2022

Publication Title

B.E. Journal of Economic Analysis and Policy

Abstract

For seven decades, states have passed legislation to regulate the exchange of funds in the adoption process by either enabling or prohibiting prospective adoptive parents from compensating a matched birth mother for adoption-related expenses. In 1940, no state codes contained provisions for adoption compensation. By the mid-1980s, nearly half of states had passed such legislation, and today, 45 states have such laws. Leveraging this variation in state adoption laws governing compensation, I estimate how the allowance of monetary transfers affects the number of infant adoptions in a two-stage difference-in-differences framework. Results indicate that the number of private infant adoptions is not affected by the passage of such laws, and estimates are robust across multiple specifications. The findings suggesting that non-fiscal concerns or uncertainty in the matching process may overshadow potential compensation of medical, legal, or living expenses.

Department

Economics and Finance

Volume Number

22

Issue Number

3

First Page

573

Last Page

600

DOI

10.1515/bejeap-2022-0010

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