The adoption subsidy's surprise

Author: John Monczunski

Public policy decisions often have unintended consequences. In 1980, for instance, Congress passed the Adoption Assistance and Child Welfare Act to encourage adoption of children from foster care, especially those with special needs. As an incentive, the law provided adopting families with an average monthly subsidy of $544 per child per month.

During the last three decades the program has exploded exponentially, echoing the sharp increase in children placed in foster care. In fact, in 2008 the subsidies are projected to cost $2 billion.

While the law has successfully encouraged adoptions, Congress didn’t anticipate that the subsidies would largely go to family members of the children. “Our preliminary findings show that children in the program are more likely to be adopted by a grandmother or aunt, someone with whom they have a familial relationship, rather than a foster parent or stranger,” says Kasey Buckles, Notre Dame assistant professor of economics.

The economist, who currently is researching the federal program’s effectiveness, says one explanation may be that family members are the only people familiar with the children who have a real incentive to adopt. Foster parents have no financial reason to adopt since they already receive a subsidy, and strangers have no history with the children.

“There is a question as to whether these familial adoptions are a good thing,” Buckles says. “On the one hand, the children are in their own families, which might make transitions easier. Also, they might have renewed contact with their old friends and other members of their family, which might be good as well. On the other hand, they may not be far removed from the situation which caused them to be placed in foster care, usually abuse or neglect.”

Buckles’ research is aimed at determining whether children fare better when adopted, especially if adopted by a family member. One way to answer that question is to see whether the children grow up to be law-abiding citizens. Using data from Illinois linking child welfare records to criminal histories, Buckles plans to see if being adopted decreases the probability of criminal arrest.