Life After Divorce: Effects Of Joint Custody On Parents And Children

Stella Canessa, Gordon Dahl, Anna Hasselqvist, Costas Meghir, Susan Niknami, MŒrten Palme, Helmut Rainer, Olof Rosenqvist and Pengpeng Xiao
Additional contact information
Stella Canessa: LMU Munich; ifo Institute
Gordon Dahl: UC San Diego; NBER; ifo Institute; CESifo; CEPR; RF-Berlin; IZA
Anna Hasselqvist: DIW Berlin; BSoE
Costas Meghir: Yale University; IFS; IZA; CEPR; NBER
Susan Niknami: SOFI, Stockholm University
MŒrten Palme: Stockholm University; IZA
Helmut Rainer: LMU Munich; ifo Institute; CESifo
Olof Rosenqvist: IFAU; Uppsala University
Pengpeng Xiao: Duke University

No 2543, Cowles Foundation Discussion Papers from Cowles Foundation for Research in Economics, Yale University

Abstract: Divorce reshapes family life, yet little is known about one of its most consequential features: the allocation of child custody. We study the impact of joint versus sole custody on both parents and children using rich administrative data from Sweden linked to over 25 years of newly-collected court custody rulings. To address selection concerns, we exploit random assignment of custody disputes to judges who differ sharply in their propensity to grant joint custody. For fathers, joint custody substantially raises earnings and improves mental health, consistent with sustained paternal involvement enhancing labor market attachment and psychological well-being. In contrast, there are no measurable labor market or mental health effects for mothers. Turning to children, joint custody increases standardized test scores and school quality without affecting mental health outcomes. Joint custody increases fathersÕ chances of remarriage, keeps separated parents in closer geographic proximity, and has no effect on intimate partner violence allegations against either partner. These findings inform longstanding debates over the role of child custody in shaping post-divorce family life.

Pages: 75 pages
Date: 2026-07-09
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