Abstract
Though child shared physical custody arrangements after divorce are much more frequent and parents who use it more diverse in many European countries, little is known about their economic consequences for parents. By relaxing family time constraints, does shared custody help divorced mothers return to or stay on work more easily? Since lone mothers are one of the least-employed groups, and they face high unemployment rates, the type of child custody arrangement adopted after divorce is of particular interest for their employability. This article analyses to what extent the type of child custody arrangement affects mothers' labour market patterns after divorce. Using a large sample of divorcees from an exhaustive French administrative income tax database, and taking advantage of the huge territorial discrepancies observed in the proportion of shared custody, we correct for the possible endogeneity of shared custody. Results show that not repartnered mothers with shared custody arrangements are 24 percentage points more likely to work one year after divorce compared to those having sole custody, while no significant effect is found for repartnered mothers. Among lone mothers, we also highlight huge heterogeneous effects: larger positive effects are observed for previously inactive women, for those belonging to the lowest income quintiles before divorce, for those with a young child, and for those who have three or more children. Thus, shared physical custody arrangements may reduce work-family conflict by diminishing childcare expenses and enlarge the possibilities to find a suitable job because of more relaxed time constraints for lone mothers.