(This abstract was borrowed from another version of this item.)"> (This abstract was borrowed from another version of this item.)">
[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/cor/louvrp/2635.html
   My bibliography  Save this paper

United but (un)equal: human capital, probability of divorce, and the marriage contract

Author

Listed:
  • CREMER, Helmuth
  • PESTIEAU, Pierre
  • ROEDER, Kerstin
Abstract
This paper studies how the risk of divorce affects the human capital decisions of a young couple. We consider a setting where complete specialization is optimal with no divorce risk. Couples can self-insure through savings which offers some protection to the uneducated spouse, but at the expense of a distortion. Alternatively, for large divorce probabilities, symmetry in education, where both spouses receive an equal amount of education, may be optimal. This eliminates the risk associated with the lack of education, but reduces the efficiency of education choices. We show that the symmetric allocation will become more attractive as the probability of divorce increases, if risk aversion is high and/or labor supply elasticity is low. However, it is only a "second-best" solution as insurance protection is achieved at the expense of an efficiency loss. Finally, we study how the (economic) use of marriage is affected by the possibility of divorce.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • CREMER, Helmuth & PESTIEAU, Pierre & ROEDER, Kerstin, 2015. "United but (un)equal: human capital, probability of divorce, and the marriage contract," LIDAM Reprints CORE 2635, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvrp:2635
    Note: In : Journal of Population Economics, 28(1), 195-217, 2015
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Libertad González & Berkay Özcan, 2013. "The Risk of Divorce and Household Saving Behavior," Journal of Human Resources, University of Wisconsin Press, vol. 48(2), pages 404-434.
    2. Alessandro Cigno, 2007. "A Theoretical Analysis of the Effects of Legislation on Marriage, Fertility, Domestic Division of Labour, and the Education of Children," CESifo Working Paper Series 2143, CESifo.
    3. Becker, Gary S, 1974. "A Theory of Marriage: Part II," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages 11-26, Part II, .
    4. Apps,Patricia & Rees,Ray, 2009. "Public Economics and the Household," Cambridge Books, Cambridge University Press, number 9780521887878.
    5. Kai A. Konrad & Kjell Erik Lommerud, 2000. "The bargaining family revisited," Canadian Journal of Economics, Canadian Economics Association, vol. 33(2), pages 471-487, May.
    6. Lommerud, Kjell Erik, 1989. "Marital Division of Labor with Risk of Divorce: The Role of "Voice" Enforcement of Contracts," Journal of Labor Economics, University of Chicago Press, vol. 7(1), pages 113-127, January.
    7. Gary S. Becker, 1974. "A Theory of Marriage," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 299-351, National Bureau of Economic Research, Inc.
    8. Helmuth Cremer & Pierre Pestieau & Maria Racionero, 2011. "Unequal wages for equal utilities," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 18(4), pages 383-398, August.
    9. Becker, Gary S & Landes, Elisabeth M & Michael, Robert T, 1977. "An Economic Analysis of Marital Instability," Journal of Political Economy, University of Chicago Press, vol. 85(6), pages 1141-1187, December.
    10. Fernández, Raquel & Wong, Joyce Cheng, 2011. "The Disappearing Gender Gap: The Impact of Divorce, Wages, and Preferences on Education Choices and Women's Work," IZA Discussion Papers 6046, Institute of Labor Economics (IZA).
    11. Raquel Fernández & Joyce Cheng Wong, 2011. "The Disappearing Gender Gap: The Impact of Divorce, Wages, and Preferences on Education Choices and Women's Work," NBER Working Papers 17508, National Bureau of Economic Research, Inc.
    12. Fernández, Raquel & Wong, Joyce Cheng, 2011. "The Disappearing Gender Gap: The Impact of Divorce, Wages, and Preferences on Education Choices and Women's Work," CEPR Discussion Papers 8627, C.E.P.R. Discussion Papers.
    13. repec:bla:scandj:v:97:y:1995:i:4:p:581-601 is not listed on IDEAS
    14. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-846, July-Aug..
    15. Borenstein, Severin & Cournat, Paul N, 1989. "How to Carve a Medical Degree: Human Capital Assets in Divorce Settlements," American Economic Review, American Economic Association, vol. 79(5), pages 992-1009, December.
    16. Johnson, William R & Skinner, Jonathan, 1986. "Labor Supply and Marital Separation," American Economic Review, American Economic Association, vol. 76(3), pages 455-469, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Andrew Grant & Steve Satchell, 2019. "Endogenous divorce risk and investment," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(3), pages 845-876, July.
    2. Togzhan Bakhtybaevna Zhunussova, 2022. "Influence of Legal Traditions and Legal Culture on the Institution of Marriage Contracts and the Possibility of its Improvement: The Experience of Kazakhstan," Academic Journal of Interdisciplinary Studies, Richtmann Publishing Ltd, vol. 11, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rania Gihleb & Osnat Lifshitz, 2022. "Dynamic Effects of Educational Assortative Mating on Labor Supply," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 46, pages 302-327, October.
    2. John Douglas Skåtun, 2017. "Bargaining on your Spouse: Coasean and Non-Coasean Behaviour Within Marriage," Journal of Family and Economic Issues, Springer, vol. 38(2), pages 263-278, June.
    3. Donni, Olivier, 2014. "Over-investment in marriage-specific capital," Mathematical Social Sciences, Elsevier, vol. 67(C), pages 34-43.
    4. Dan Anderberg & Helmut Rainer & Kerstin Roeder, 2016. "Family-Specific Investments and Divorce: A Theory of Dynamically Inconsistent Household Behavior," CESifo Working Paper Series 5996, CESifo.
    5. Steven F. Koch, 2005. "Love and Addiction: The Importance of Commitment," Working Papers 200516, University of Pretoria, Department of Economics.
    6. Alessandro Cigno, 2011. "The Economics of Marriage," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 12(s1), pages 28-41, May.
    7. Telalagic, S., 2012. "Domestic Production as a Source of Marital Power: Theory and Evidence from Malawi," Cambridge Working Papers in Economics 1243, Faculty of Economics, University of Cambridge.
    8. Zvi Eckstein & Osnat Lifshitz, 2015. "Household Interaction And The Labor Supply Of Married Women," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56(2), pages 427-455, May.
    9. Kelly Bedard & Olivier Deschênes, 2005. "Sex Preferences, Marital Dissolution, and the Economic Status of Women," Journal of Human Resources, University of Wisconsin Press, vol. 40(2).
    10. Kerwin Kofi Charles & Melvin Stephens, 2004. "Job Displacement, Disability, and Divorce," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 489-522, April.
    11. Filippo Pericoli & Luigi Ventura, 2012. "Family dissolution and precautionary savings: an empirical analysis," Review of Economics of the Household, Springer, vol. 10(4), pages 573-595, December.
    12. Kraft, Kornelius & Neimann, Stefanie, 2009. "Effect of Labor Division between Wife and Husband on the Risk of Divorce: Evidence from German Data," IZA Discussion Papers 4515, Institute of Labor Economics (IZA).
    13. Svarer, Michael, "undated". "Determinants of Divorce in Denmark," Economics Working Papers 2002-19, Department of Economics and Business Economics, Aarhus University.
    14. Alessandro Cigno, 2014. "Is Marriage as Good as a Contract?," CESifo Economic Studies, CESifo Group, vol. 60(3), pages 599-612.
    15. Maria Stanfors & Frances Goldscheider, 2017. "The forest and the trees: Industrialization, demographic change, and the ongoing gender revolution in Sweden and the United States, 1870-2010," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 36(6), pages 173-226.
    16. John M. Nunley & Alan Seals, 2010. "The Effects of Household Income Volatility on Divorce," American Journal of Economics and Sociology, Wiley Blackwell, vol. 69(3), pages 983-1010, July.
    17. Grossbard-Shechtman, Shoshana, 2003. "A consumer theory with competitive markets for work in marriage," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 31(6), pages 609-645.
    18. Waters, Melissa S. & Ressler, Rand W., 1999. "An economic model of cohabitation and divorce," Journal of Economic Behavior & Organization, Elsevier, vol. 40(2), pages 195-206, October.
    19. Robert Kaestner, 1995. "The Effects of Cocaine and Marijuana Use on Marriage and Marital Stability," NBER Working Papers 5038, National Bureau of Economic Research, Inc.
    20. Tetyana Zubro, 2014. "Vnútropolitické Determinanty Krízovej Situácie Na Ukrajine," Almanach (Actual Issues in World Economics and Politics), Ekonomická univerzita, Fakulta medzinárodných vzťahov, vol. 9(1), pages 73-85.

    More about this item

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • K36 - Law and Economics - - Other Substantive Areas of Law - - - Family and Personal Law

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cor:louvrp:2635. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alain GILLIS (email available below). General contact details of provider: https://edirc.repec.org/data/coreebe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.