Complex Families: Analyzing Policy Contradictions

1. Complex Families: Analytic complications and policy conundrums Maria Cancian Madison Chaos and Complex Systems Seminar February 2, 2010

2. Acknowledgements Primary results drawn from collaborative research with Daniel R. Meyer and others, including: • “Alternative Approaches to Child Support Policy in the Context of Multiple-Partner Fertility” (2009; with Meyer) • “The Evolution of Family Complexity from the Perspective of Children” (Forthcoming in Demography; with Meyer and Cook) • “Multiple Partner Fertility: Incidence and Implications for Child Support Policy” (Social Service Review, 2006; with Meyer & Cook) Research supported by WI DCF/BCS, and US DHHS/ACF

3. Outline • What makes a family complex? Frequency and correlates of MPF • Implications of complex families for social policy: the example of child support • Why are child support guidelines interesting and important? • Child support guidelines and conceptual issues in the context of MPF • Conclusions

4. What makes a family complex? • Multiple partner fertility (MPF) refers to parents who have children with multiple partners: • Mothers who have children with more than one father • Fathers who have children with more than one mother • Children who share their mother and/or father with half-siblings

5. Case 1: M=D=S=H Dad Mom KidKid 1 Mom = 1Dad = 1 Sibship = 1 Household

6. Case 2: M=D=S=H Dad Mom KidKid 1 Mom = 1Dad = 1 Sibship = 2 Household

7. Case 3: M=D=S=H Mom Dad Dad KidKid 1 Mom = 2Dads = 2 Sibships = 3 Households

8. Case 4: M=D=S=H Mom Dad Dad Mom KidKidKid 1 Mom* = 2Dads = 3 Sibships = 4 Households *1 “focal” mom

9. Implications of Complex Families • MPF raises issues for any social policy– from social security to child support to income taxes– in which costs or benefits depend on family structure • MPF raises a host of measurement and conceptual issues • Complexity (and implications) varies depending on “perspective” (mother, father, child) • Difficult to collect information on MPF from standard surveys • Complex design issues (asking respondent about former partners’ previous or subsequent partners) • Under-reporting (especially by noncustodial parents) • Practical importance depends in large part on incidence

10. Measuring the incidence of MPF: Sample and data structure We rely on longitudinal administrative data from the WI Child Support Enforcement (CSE) system Primary analysis focuses on nonmarital births 40% of U.S. births in 2007 to unmarried parents Analytic sample: 7,169 first-born children of unmarried mothers in Wisconsin in 1997, followed through 2007 Overall, data capture about 90% of all nonmarital births in WI Sample excludes: children with unidentified fathers (N=1,865) children who had full siblings also born in 1997 (N=151) 10

11. Data: Advantages & Limitations Advantages: Administrative records capture nearly all subsequent nonmarital births to either parent, regardless of parents’ intensity of contact Complete and accurate record of formal child support, earnings, and benefits in Wisconsin over 10 years Large sample Limitations: Subsequent marital births only measured if parents divorce within timeframe Excludes births and income outside Wisconsin (>80% still in WI records in 2007) Excludes informal child support and earnings, “social” siblings and parents Captures new partnerships only if a birth results 11

12. Results: Frequency of family complexity for first-born nonmarital children Dad half sibs Mom & Dad half sibs Mom half sibs Only Full Sibs No siblings 12

13. Parents’ additional partners 13

14. Number of Father’s Partners by Number of Mother’s Partners Number of Father’s Partners 4 3 2 1

15. Why are child support guidelines interesting and important? • Most children will spend some time living apart from one of their biological parents • Child support guidelines are of interest because they: • have direct consequences for the economic well-being of children and their resident & nonresident parents • embody a set of values (and incentives) regarding parental responsibility, co-residence, etc • Numeric CS guidelines in the U.S. are designed to: • provide adequate support for children living apart from a biological parent (improving child well-being and reducing need for public support of children); • improve horizontal equity, reduce uncertainty and litigation

16. How are child support order amounts determined in the U.S.? • U.S. Federal law requires “presumptive” child support guidelines in each state. • State guidelines generally build on “continuity–of-expenditures” approach and aim to replicate expenditures in intact families • Parents with larger families spend more in total (less per child) • Parents with higher incomes spend more for given number of children • For “simple” families, the resulting guidelines are also consistent with principles of: • Manageable burdens • Economies of scale • But, for complicated families there is no straightforward point of comparison (“intact” counterfactual) and “simple” approaches are often have unintended consequences

17. Wisconsin guidelines for “simple” families • The proportion of the nonresident father’s income due to a resident mother who has had children with one father is : • 17% for one child • 25% for two children • 29% for three children • 31% for four children • 34% for five or more children

18. Example: child support paid/received for a simple family • Example: a father earning $10,000/year has two children with one mother. The children live with their mother. • Child support guideline: 25% income • The father should pay $2500/year (25% of $10,000). • The mother should receive $2500/year

19. Wisconsin guidelines for “complicated” families • Each couple considered individually and sequentially (i.e. first marriage/partnership first) • If all children live with their mother: • CS owed to mother invariant to number of other children/sibships in her household • CS owed by father adjusted only to account for father’s lower income net of previous orders.

20. Example: Child support paid/received for a complicated family • Example: a father earning $10,000/year has two children, one with each of two mothers. Each mother previously had one child with another father with the same earnings and no other CS obligations. All children live with their mother. • Child support guideline: 17% income per child • The father should pay $1700/year in child support to the first mother, and $1411/year to the second mother (17% of the $8300 remaining after he’s paid the first mother) for a total of $3111. • The first mother should receive a total of $3400 from both fathers; the second should receive $3111.

21. Child support guidelines and conceptual issues given MPF • What is the appropriate unit of analysis? • Couple • Resident parent (“mother-focused”) • Nonresident parent (“father-focused”) • How should birth ordering be treated? • Distinguish implications for resident mothers (and children) and nonresident fathers

22. Alternative approaches: family unit In determining total amounts due/owed • couple-specific=> consider each simple family separately • collective mother-focused=> consider all children living with the resident mother in setting total CS due to mother • collective father-focused=> consider all children for whom the nonresident father owes support in setting total CS owed by father

23. Alternative approaches: Birth ordering In distributing rights to claim support, or obligations to pay support • Sequential=> consider each sibship in birth order; this holds sibship harmless with respect to parents’ subsequent partnerships/fertility • Average=> provides each sibship with “average” amounts; does not distinguish by birth order

24. Simulating alternative approaches to CS given MPF • Hypothetical orders using WI guidelines and given: • three children per mother (or per father) • All fathers (mothers) have single child with any other partners • All fathers have identical incomes ($10,000) • For sequential approaches show results for first and last families • Paper (Cancian and Meyer, 2009) includes estimates of alternative policy regimes • “hypothetical” results • simulations based on observed family structure and incomes of Wisconsin families

27. Conclusions • Too many children in families with MPF to ignore implications for CS and other policy • Alternative policies lead to very different outcomes with important implications for family well being • Difficult (and interesting) policy problem: • Conflicting principles=> inevitable tradeoffs • Given multiple relevant units of analysis, need to consider outcomes from different perspectives • In addition to providing differential support to current families, policies create different incentives for future births by MPF status

28. For more information Related papers and reports: http://www.irp.wisc.eduormcancian@wisc.edu

29. Hypothetical CS owed to mother with 3 children; couple-specific(Table 3b, 1-3; every father has single child with any other mothers)

30. Hypothetical CS owed to mother with 3 children; collective mother-focused(Table 3b, 4-6; every father has single child with any other mothers)

31. Hypothetical CS owed to mother with 3 children; collective father-focused(Table 3b, 7-9; every father has single child with any other mothers)