Saving International Adoption: An Argument from Economics and Personal Experience

Vanderbilt University Press (January 2018)

Choice Outstanding Academic Title of 2018

International adoption is in a state of virtual collapse, rates having fallen by more than half since 2004 and continuing to fall. Yet around the world millions of orphaned and vulnerable children need permanent homes, and thousands of American and European families are eager to take them in. Many government officials, international bureaucrats, and social commentators claim these adoptions are not "in the best interests" of the child. They claim that adoption deprives children of their "birth culture," threatens their racial identities, and even encourages widespread child trafficking. Celebrity adopters are publicly excoriated for stealing children from their birth families.

This book argues that opposition to adoption ostensibly based on the well-being of the child is often a smokescreen for protecting national pride. Concerns about the harm done by transracial adoption are largely inconsistent with empirical evidence. As for trafficking, opponents of international adoption want to shut it down because it is too much like a market for children. But this book offers a radical challenge to this view—that is, what if instead of trying to suppress market forces in international adoption, we embraced them so they could be properly regulated? What if the international system functioned more like open adoption in the United States, where birth and adoptive parents can meet and privately negotiate the exchange of parental rights? This arrangement, the authors argue, could eliminate the abuses that currently haunt international adoption.

The authors challenge the prevailing wisdom with their economic analyses and provocative analogies from other policy realms. Based on their own family's experience with the adoption process, they also write frankly about how that process feels for parents and children.

"The authors make profound and very persuasive arguments based on their own experience as adopters and on case studies. . . . This book needs to be read not only by administrators of adoption programs but also by all members of the public so that public opinion can bring about the excellent changes the book suggests. . . . Essential." —Choice

Research Papers

Does the Hague Convention Increase or Decrease International Adoptions?

Mark Montgomery and Irene Powell

Working Paper, August 2019


In the 25 years since its inception, the number of countries implementing the Hague Convention on International Adoption gradually rose from zero to about 100 (roughly half). Over the same period, the number of international adoptions first soared from 20,000 to 45,000, then plummeted to less than 10,000. What role, if any, did the Convention play in this meteoric rise and fall? This paper examines whether putting the Hague Convention in force increased or decreased the number of children a country sent to the US for adoption. Tobit models, using a 1992-2016 panel of State Department adoption data, imply that after controlling for time-varying country characteristics and country-specific fixed effects, Hague implementation reduced adoptions to the US by as much as 7.5%. Though that impact may not seem large, it could mean that as many as 24,000 children were denied the chance to join families in the U.S.

Back to School: An Application of Human Capital Theory to Mature Workers

Christopher Jepsen and Mark Montgomery

Economics of Education Review, February, 2012


There is a vast literature on the decision to enroll in higher education, but it focuses almost entirely on traditional students: 18 year olds graduating from high school. Yet less than half of students at degree-granting institutions are in the traditional age range, 18-22; nearly 40 percent are at least 25. This study looks at the enrollment behavior of persons 25 or older using data from a large-scale 1998 Department of Labor (DOL) policy demonstration in Greater Baltimore. Our data allow us to examine factors such as age, earnings and marital status that vary little among the much-studied traditional students. Our results conform to the (rarely tested) predictions of human cap that age and opportunity costs are impediments to enrollment. We also find that where you live has a substantial impact on whether you return to school.

Miles to go before I learn: The effect of travel distance on the

mature person's choice of a community college

Christopher Jepsen and Mark Montgomery

Journal of Urban Economics, January 2009


The substantial literature on access to higher eduction has a narrow focus: the effect of tuition on the enrollment decisions of 18-year-olds seeking bachelors degrees. But for non-traditional (i.e. older) students who tend to prefer community college, access is more about a school's location than about its tuition and fees. Using data on over 150,000 mature workers (aged 25 to 49) in the Greater Baltimore area, we analyze the impact of travel distance on community college enrollment decisions. We find that distance is a highly statistically significant factor in deciding whether to enroll in community college, and in which school to choose. Simulations of the model suggest that if the typical resident had to travel three additional miles from home to the nearest college, enrollment could drop by as much as 14%.

Best Laid Plans: Gender and the MBA Completion Rates of GMAT Registrants

Mark Montgomery and Katharine Anderson

Quarterly Review of Economics and Finance, February 2007


Evidence suggests that while women are more likely to go to college than men, they are less likely to go to graduate school. Moreover, in fields like science and engineering, women who do pursue advanced degrees are less likely than men to complete them. This paper compares MBA completion rates for women and men who registered to take the Graduate Management Admission Test (GMAT). We find that female test registrants are about 30% less likely than men to complete the MBA. This difference in completion rates seems only partly due to gender disparity in family responsibilities.

The Effect of Tuition and Opportunity Cost on the Pursuit and Completion of a

Graduate Mangement Degree


Mark Montgomery and Irene Powell

Journal of Education for Business, March/April 2006


This study uses multivariate statistical analysis to examine the impact cost on the likelihood a person will enroll in and complete, respectively, an MBA program.  It considers both the explicit cost of paying tuition and the implicit cost, or opportunity cost, of earnings foregone while in school.  Results suggest that tuition is not a major impediment either to pursuing or to completing an MBA.  High opportunity cost, however, tends to reduce enrollment and degree completion.

What Kind of Capital Do You Need to Start a Business:

Financial or Human

Mark Montgomery, Terry Johnson and Sayed Faisal

Quarterly Review of Economics and Finance, February 2005


Studies of self-employment disagree on the relative importance of human and financial capital in starting a business and keeping it open. This paper uses data from the Washington Self-Employment and Enterprise Development Demonstration (SEED) to model the decision to start a business jointly with the probability that the business will succeed. We find that when start-up and survival are modeled simultaneously, human capital appears to increase the probability of pursuing self-employment, but not the probability of succeeding at it. Financial capital, on the other hand, seems to makes it easier to both start a business and to keep it going. These results shed significant light on an important policy debate: do financial markets provide too little capital to small-business start-ups?

Does a Woman with an Advanced Degree Face Less Discrimination?

Evidence from MBA Recipients

Mark Montgomery and Irene Powell

Industrial Relations, July 2003


Economists have argued that employers discriminate among prospective hirees on the basis of signals such as race, sex, or education levels. To what extent can a “positive” signal like higher education counteract a “negative” one like being female or a minority member? This paper tests the hypothesis that a woman with an MBA will face less discrimination than a woman without one. Using a new longitudinal survey of registrants for the Graduate Management Admission Test, we compare the gender wage gap among MBA recipients with the gap among non-recipients. The GMAT registrant
survey makes this comparison feasible by providing good measures of normally unobservable personal attributes like ability, quality of education, and attitudes toward career and family. We find evidence that women with an MBA suffer less discrimination than they would without the degree.

A Nested Logit Model of the Choice of a Graduate Business School

Mark Montgomery

Economics of Education Review, October 2002


Less than a handful of papers have used data on individuals to examine people's decisions about which school to attend. This paper develops a nested logit model of the determinants of choice of a graduate business school. Data are drawn from a new longitudinal survey of registrants for the Graduate Management Admission Test. One finding is that elasticity of school choice with respect to tuition is fairly low, about 0.08. Another is that, even after controlling for the effects of Affirmative Action in admissions, blacks and Hispanics are substantially more attracted to top-tier institutions, while women are less attracted to them.