Yurko, Anna (2012): Costly Divorce and Marriage Rates.
Download (252Kb) | Preview
This paper develops a model of choice between marriage and cohabitation to study the effect of divorce costs on marriage decision. The paired agents are heterogeneous, the utility is non-transferable, and break up and divorce decisions are modeled explicitly as unilateral, that is, it takes the decision of only one partner to terminate a relationship. This framework is empirically relevant, since unilateral divorce is legal in many countries, and multiple empirical studies of the effect of changes in divorce laws on divorce rates demonstrate that Coase theorem does not hold (partners cannot bargain efficiently). The model seeks to reconcile the conflicting empirical evidence on the relationship between marriage rates and divorce costs.
|Item Type:||MPRA Paper|
|Original Title:||Costly Divorce and Marriage Rates|
|Keywords:||family economics; marriage; cohabitation; divorce; externalities|
|Subjects:||D - Microeconomics > D6 - Welfare Economics > D62 - Externalities
J - Labor and Demographic Economics > J1 - Demographic Economics > J12 - Marriage; Marital Dissolution; Family Structure; Domestic Abuse
|Depositing User:||Anna Yurko|
|Date Deposited:||03. Apr 2012 19:31|
|Last Modified:||13. Feb 2013 04:31|
Gary Becker, Elisabeth Landes, and Robert Michael. An economic analysis of marital instability. Journal of Political Economy, 85:1141–1187, 1977.
Michael Brien, Lee Lillard, and Steven Stern. Cohabitation, marriage, and divorce in a model of match quality. International Economic Review, 47(2):451–494, 2006.
Giulio Fella, Paola Manzini, and Marco Mariotti. Does divorce law matter? Journal of the European Economic Association, 2(4):607–633, 2004.
Leora Friedberg. Did unilateral divorce raise divorce rates? Evidence from panel data. American Economic Review, 88(3):608–628, 1998.
Libertad Gonzalez and Tarja Viitanen. The effect of divorce laws on divorce rates in Europe. European Economic Review, 53:127–138, 2009.
Brishti Guha. Sex ratios, divorce laws and the marriage market. Paper no. 28, SMU Economics and Statistics Working Paper Series, 2010.
Niko Matouschek and Imran Rasul. The economics of the marriage contract: Theories and evidence. Journal of Law and Economics, 51:59–110, 2008.
Society at a Glance. OECD Social Indicators, 2005, 2006, 2011.
Imran Rasul. The impact of divorce laws on marriage. Unpublished manuscript, University of Chicago, Graduate School of Business, 2005.
Imran Rasul. Marriage markets and divorce laws. Journal of Law and Economics, 22(1):30–69, 2006.
Betsey Stevenson and Justin Wolfers. Marriage and divorce: Changes and their driving forces. Journal of Economic Perspectives, 21(2):27–52, 2007.
Justin Wolfers. Did unilateral divorce laws raise divorce rates? A reconciliation and new results. American Economic Review, 96(5):1802–1820, 2006.
Bruce Wydick. Grandma was right: Why cohabitation undermines relational satisfaction, but is increasing anyway. KYKLOS, 60(4):617–645, 2004.