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The Impact of Divorce Laws on Marriage-Specific Capital

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Author Info
Betsey Stevenson

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Abstract

This article considers how divorce law alters the incentives for couples to invest in their marriage, focusing on the impact of unilateral divorce laws on investments in new marriages. Differences across states between 1970 and 1980 provide useful quasi-experimental variation with which to consider incentives to invest in several types of marriage-specific capital: spouse’s education, children, household specialization, and home ownership. I find that adoption of unilateral divorce—regardless of the prevailing property-division laws—reduces investment in all types of marriage-specific capital considered except home ownership. In contrast, results for home ownership depend on the underlying property division laws.

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File URL: http://www.journals.uchicago.edu/cgi-bin/resolve?id=doi:10.1086/508732
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Publisher Info
Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 25 (2007)
Issue (Month): ()
Pages: 75-94
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Handle: RePEc:ucp:jlabec:v:25:y:2007:p:75-94

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  1. Gonzalez, Libertad & Özcan, Berkay, 2008. "The Risk of Divorce and Household Saving Behavior," IZA Discussion Papers 3726, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  2. Stéphane Mechoulan, 2005. "“Economic Theory’s Stance On No-Fault Divorce”," Review of Economics of the Household, Springer, vol. 3(3), pages 337-359, 09. [Downloadable!] (restricted)
  3. Marco Francesconi & Helmut Rainer & Wilbert van der Klaauw, 2009. "Unintended Consequences of Welfare Reform: The Case of Divorced Parents," CRIEFF Discussion Papers 0901, Centre for Research into Industry, Enterprise, Finance and the Firm. [Downloadable!]
    Other versions:
  4. Gonzalez, Libertad & Viitanen, Tarja, 2008. "The Long Term Effects of Legalizing Divorce on Children," IZA Discussion Papers 3789, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  5. Akiko Maruyama & Takashi Shimizu & Kazuhiro Yamamoto, 2009. "Exit and Voice in a Marriage Market," Discussion Papers in Economics and Business 09-04-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Mar 2009. [Downloadable!]
    Other versions:
  6. Martin Halla & Johann Scharler, 2008. "Marriage, Divorce and Interstate Risk Sharing," NRN working papers 2008-03, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria. [Downloadable!]
    Other versions:
  7. Mark L. Hoekstra, 2007. "The Effects of Near and Actual Parental Divorce on Student Achievement and Misbehavior," Working Papers 305, University of Pittsburgh, Department of Economics, revised Jan 2009. [Downloadable!]
  8. Gustavo J Bobonis, 2009. "The Impact of Conditional Cash Transfers on Marriage and Divorce," Working Papers tecipa-359, University of Toronto, Department of Economics. [Downloadable!]
  9. Martin Halla, 2009. "The Effect of Joint Custody on Marriage and Divorce," NRN working papers 2009-09, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria. [Downloadable!]
    Other versions:
  10. Miriam Steurer, 2009. "Children as Family Public Goods: Some Implications for Fertility," Discussion Papers 2009-04, School of Economics, The University of New South Wales. [Downloadable!]
  11. Julio Cáceres-Delpiano & Eugenio Giolito, 2008. "The impact of unilateral divorce on crime," Economics Working Papers we081006, Universidad Carlos III, Departamento de Economía. [Downloadable!]
    Other versions:
  12. Nunley, John M. & Seals, Alan, 2009. "Child-Custody Reform and Marriage-Specific Investment in Children," MPRA Paper 16313, University Library of Munich, Germany. [Downloadable!]
  13. David Love, 2008. "The Effect of Marital Status and Children on Savings and Portfolio Choice," Department of Economics Working Papers 2008-13, Department of Economics, Williams College. [Downloadable!]
  14. Antecol, Heather & Steinberger, Michael, 2009. "Female Labor Supply Differences by Sexual Orientation: A Semi-Parametric Decomposition Approach," IZA Discussion Papers 4029, Institute for the Study of Labor (IZA). [Downloadable!]
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