• Media type: Report; E-Book
  • Title: The effect of paying parents to adopt: Evidence from Minnesota's foster-care system
  • Contributor: Bishop, Kelly C. [Author]; Mac Donald, Diana E. [Author]
  • Published: Ciudad de México: Banco de México, 2022
  • Language: English
  • Keywords: I38 ; Foster Care ; Government Transfers ; Family Policy ; H75 ; J13 ; D1 ; Adoption
  • Origination:
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  • Description: Aimed at increasing the adoption rate of older children, Minnesota's 2015 Northstar Care Program eliminated the adoption penalty (the decrease in fostering-based financial transfers associated with adoption) for children aged six and older, while maintaining it for children under age six. Using a difference-in-differences estimation strategy that controls for a rich set of covariates, we find that parents responded positively to this change in direct financial payments; the annual adoption rate of older foster children aged six to eleven increased by approximately 7 percentage points (22% at the mean) as a result of the program. We additionally find evidence of strategic adoption behavior as the adoption rate of younger children temporarily increased by 11 percentage points (26% at the mean) in the year prior to the program's implementation.
  • Access State: Open Access