Economic Incentives and Foster Care Placement

October 27, 2004 Using micro level data on children entering foster care in 1998, Brian Duncana and Laura Argysa estimated how the financial compensation paid to foster caregivers affects the placement of foster children. They used the data to research how the amount of money allocated to foster cares changes the probability of a child being placed in a permanent home. Duncana and Argysa controlled for observable child, county characteristics, and unobservable state effects. Some of results show that a $100 increase in the basic monthly foster-care payment reduces the probability that a child will be placed in a . . .