Family first or the kindness of strangers? Foster care placements and adult outcomes

•Kinship care leads to systematically better adult outcomes for foster youth.•Improved outcomes may not be realized until foster youth are well into adulthood.•By reducing socially costly outcomes kinship care may be more cost efficient.•Kinship care may promote ties between foster youth and biological families. We evaluate the long-run effects of placing foster children with extended family, rather than unrelated caregivers. An instrumental variable identification strategy is used to estimate the effects of kinship care relative to traditional foster care. We find former foster youth placed with kin benefit across a host of important adult outcomes, including increases in employment and education, and reductions in public assistance, homelessness, and incarceration. Estimated effects are statistically significant, and robust to multiple specifications. Findings suggest kinship care has the potential to improve important adult outcomes for a large, at-risk population and create large social cost savings.