The Law and Economics of Child Support Payments

The Law and Economics of Child Support Payments

Edited by William S. Comanor

To understand the issues involved, leading lawyers and economists examine various facets of the child support system from a law and economics perspective. They consider the incentives faced by both custodial and non-custodial parents, and search for policy actions that are more incentive-compatible for all participants. The assumptions underlying current child support guidelines are discussed, as are the ways in which child support payments affect family structure, teenage delinquency and income disparities between parents.

Chapter 3: Child support guidelines: underlying methodologies, assumptions, and the impact on standards of living

R.Mark Rogers and Donald J. Bieniewicz

Subjects: politics and public policy, public policy


R. Mark Rogers and Donald J. Bieniewicz I. INTRODUCTION The federal Family Support Act of 1988 required states to enact presumptive child support guidelines to address the alleged problem of too low a standard of living for custodial parents following divorce. By the end of 1989, all states had enacted guidelines that rested largely on two alternative economic models and cost tables. This chapter addresses the following questions: what child support guidelines are currently in use or considered as alternatives? What are the underlying methodologies and assumptions used for each guideline? And how does the imposition of each guideline’s presumptive award affect the relative standards of living of the households of the custodial parent and the non-custodial parent? The guidelines reviewed are: 1. 2. 3. The simple percent-of-obligor-income guideline. This guideline is currently used by 13 states. Income Shares. This guideline, developed and marketed by Policy Studies, Inc., is currently used in 33 states. US Department of Agriculture (USDA) child cost table based guidelines. Currently, no state uses this guideline, but the USDA estimates have been used as a cross-check on the accuracy of existing guidelines. A guideline directly based on the USDA estimates has been introduced as proposed legislation in Minnesota (H.F. 110 in the 2003–2004 legislative session). Cost Shares.1 Currently, no state uses this guideline, but it is based on principles that were in common use and embodied in state law prior to 1988. This guideline has recently been introduced as proposed legislation in two state...

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