2006-13 The distribution of a federal entitlement : The case of adoption assistance

Adoption assistance entitlements support the adoptions of children whose birth parents’ rights have been severed after abuse or neglect. The subsidies are meant to offset the extra cost to adoptive families of raising children whose adverse experiences have left them with special physical, emotional, or behavioral needs. Previous studies of adoption assistance are limited in scope; I use administrative data on all recorded adoptions from foster care from 1996 through 2003 to examine the distribution of adoption assistance across and within states. The state-tostate variation payments is large, even after controlling for differences in the cost of living. Moreover, although adoption assistance is an entitlement for children, payments made within many states are systematically correlated with the characteristics of adoptive families. There is substantial evidence that the state administration of this federal entitlement leads to unequal treatment of similar children.