Noncustodial Fathers' Knowledge about Child Support Rules and Its Impact on Child Support Payments

This paper analyzes the effect of noncustodial fathers' knowledge of child support on their child support payments. Why some noncustodial fathers pay child support while others do not? We use data from a state-wide policy experiment that resulted in some fathers' child support payments being passed-through directly to their children, while other fathers' payments were largely retained by the government to offset welfare costs. We use data from this random assignment experiment to measure fathers' understanding of the policy they face, and the impact of their understanding on child support paid.

Research has shown that child support receipt is effective in increasing the income of single-mother households, as well as positively impacts on children's educational, developmental, and cognitive outcomes (Pirog & Ziol-Guest, 2006). However, only 39 percent of eligible custodial parents received any child support during 2005 (U.S. Census Bureau, 2007).

To explain the low level of child support payment by noncustodial fathers, we test two hypotheses: (1) noncustodial fathers gain knowledge about child support, that their children receive all child support (full pass-through), through contact with mothers; (2) knowledgeable fathers will be more likely to pay child support.

To test these hypotheses, this paper utilizes the data from the Survey of Wisconsin Works Families and Wisconsin state administrative data. Random effect panel data analysis is applied to two-wave panel of 270 mother-father pairs (1999 and 2000). Because fathers' knowledge is dichotomously measured, logit model is used to test the first hypothesis. Two-sided tobit model is employed to analyze the effect of fathers' knowledge on the compliance rate.

Descriptive analyses show that less than 30 percent of fathers correctly understood the full pass-through rules. Multivariate results support the first hypothesis. Fathers who had contact with mothers, especially mothers who also had correct knowledge, are more likely to have correct knowledge about full pass-through. Compared with those who had contact with mothers who did not have correct knowledge, the odds of having correct knowledge for fathers who had contact with knowledgeable mothers increased by 651 percent. The second hypothesis is also empirically supported. A difference-of-difference estimator of previous compliance rate and correct knowledge is statistically significantly associated with the subsequent compliance rate (13 percent), suggesting that fathers who knew the rules tended to pay more child support.

This analysis builds on earlier research (Meyer, Cancian, & Nam's JPAM (2007)) which finds that mothers who correctly understood child support rules received more child support than others. The results of this paper highlight the importance for child support payments of relationship quality and information sharing between mothers and fathers. TANF reauthorization in 2006 allows states to transfer more child support to families on welfare. For this incentive to be effective, however, more effort will be required to improve mothers and fathers' knowledge and understanding of the changes.