One criticism of the U.S. child support system is that orders are set too high, and this may be counterproductive, resulting in lower payments, less regular payments, and noncustodial parents paying lower a lower percentage of what is due (compliance). Prior research on these questions is dated, pays limited attention to noncustodial parents with high orders because they owe support to multiple families, and has provided very mixed results, with the two key studies suggesting very different levels of burden (the amount owed divided by noncustodial parent earnings) that are “too high.” This paper examines how the burden of child support orders is related to payments, regularity, and compliance to inform conversations on how much child support should be expected from noncustodial parents, particularly those with limited abilities to pay.
Data and Methods
We use recent child support and earnings records from the state of Wisconsin to identify 29,857 pairs of noncustodial fathers and custodial mothers who had their first order in 2010, 2011, or 2012. We follow the pairs over three years and use fixed-effects models to examine how changes in child support burdens are related to patterns of child support payments, compliance, and regularity over time. We use the models to estimate whether there is threshold order level at which payments, regularity, and compliance begin to decline. We also examine if these relationships differ for noncustodial fathers with earnings below 200 percent of the federal poverty guidelines, for fathers with multiple orders, and for fathers with one, two, and three or more children.
We find that those with higher burdens generally pay more child support, but pay a lower proportion of the total support owed, and less regularly. For example, child support payments generally increase with burdens up to levels of 30 percent, and, in some specifications, up to 50 percent of earnings. In contrast, our models predicting compliance and regularity indicate that the highest compliance and regularity rates are associated with the lowest burdens (0 to 10 percent of earnings), and both compliance and regularity fall consistently with higher burden levels. Tobit results generally are consistent with the fixed-effects models, and results are similar for fathers with earnings below 200 percent of the federal poverty guidelines.
We find that higher orders are associated with higher payments, but fathers typically have difficulty meeting obligations that exceed 30 percent of their earnings. Yet, the policy implications of these findings are more nuanced and largely depend on the goals of state child support agencies. If the goal is to maximize payments, orders of almost any level are associated with higher payments compared to very low orders (orders up to 10 percent of earnings). However, higher orders are associated with lower compliance and regularity, which could mean higher debt for noncustodial parents, lower child support performance for the agency, and higher costs associated with enforcement actions. Hence, if the goal is to maximize compliance or regularity, lower orders are better.