Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/251298 
Year of Publication: 
2022
Series/Report no.: 
Working Papers No. 2022-01
Publisher: 
Banco de México, Ciudad de México
Abstract: 
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.
Subjects: 
Family Policy
Government Transfers
Adoption
Foster Care
JEL: 
D1
J13
I38
H75
Document Type: 
Working Paper
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