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The Effects of Divorce Risk on the Labour Supply of Married Couples

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Author Info
Kerry L. Papps () (Cornell University and IZA Bonn)

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Abstract

This paper presents a model of lifetime utility maximisation in which expectations of future marital transitions play a role in the determination of work hours. Married people with spouses who earn more are predicted to devote additional time to the labour market when they are confronted with a high likelihood of divorce and vice versa. Similarly, work hours should be positively associated with marriage probability for those single people who expect to marry a higher earning spouse. These predictions are tested using data from the National Longitudinal Survey of Youth 1979. Marriage and divorce probabilities are calculated from Cox proportional hazard models and are included in regressions of annual hours. Married women are found to work more when they face a high probability of divorce. This relationship holds both over an individual’s life-cycle and across people with different inherent risks of divorce. Similar results are found when a woman’s happiness with her marriage is used as a proxy for divorce risk.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2395.

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Length: 46 pages
Date of creation: Oct 2006
Date of revision:
Handle: RePEc:iza:izadps:dp2395

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Related research
Keywords: divorce; labour supply; hazard models;

Other versions of this item:

Find related papers by JEL classification:
J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Lundberg, Shelly & Pollak, Robert A, 1993. "Separate Spheres Bargaining and the Marriage Market," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 988-1010, December. [Downloadable!] (restricted)
    Other versions:
  2. Kelly Bedard & Olivier Deschenes, 2003. "Sex Preferences, Marital Dissolution and the Economic Status of Women," University of California at Santa Barbara, Economics Working Paper Series 6-03, Department of Economics, UC Santa Barbara. [Downloadable!]
  3. Joni Hersch & Leslie S. Stratton, 2000. "Household specialization and the male marriage wage premium," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 54(1), pages 78-94, October.
  4. Avner Ahituv & Robert I. Lerman, 2005. "How Do Marital Status, Wage Rates, and Work Commitment Interact?," IZA Discussion Papers 1688, Institute for the Study of Labor (IZA). [Downloadable!]
  5. Kermit Daniel, . "Does Marriage Make Men More Productive?," University of Chicago - Population Research Center 92-2, Chicago - Population Research Center.
  6. David Neumark & Sanders D. Korenman, 1988. "Does marriage really make men more productive?," Finance and Economics Discussion Series 29, Board of Governors of the Federal Reserve System (U.S.).
  7. Blackburn, McKinley & Korenman, Sanders, 1994. "The Declining Marital-Status Earnings Differential," Journal of Population Economics, Springer, vol. 7(3), pages 247-70, July.
  8. Heineck, Guido, 2004. "Does religion influence the labor supply of married women in Germany?," The Journal of Socio-Economics, Elsevier, vol. 33(3), pages 307-328, July. [Downloadable!] (restricted)
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  9. Siobhan Austen, 2004. "Labour Supply and the Risk of Divorce: An Analysis of Australian Data," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 37(2), pages 153-165, 06. [Downloadable!] (restricted)
  10. Johnson, William R & Skinner, Jonathan, 1986. "Labor Supply and Marital Separation," American Economic Review, American Economic Association, vol. 76(3), pages 455-69, June. [Downloadable!] (restricted)
  11. Shannon N. Seitz, 1999. "Labor Supply, Divorce and Remarriage," UWO Department of Economics Working Papers 9902, University of Western Ontario, Department of Economics. [Downloadable!]
  12. Peters, H Elizabeth, 1986. "Marriage and Divorce: Informational Constraints and Private Contracting," American Economic Review, American Economic Association, vol. 76(3), pages 437-54, June.
  13. Haurin, Donald R, 1989. "Women's Labor Market Reactions to Family Disruptions," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 54-61, February. [Downloadable!] (restricted)
  14. John H. Johnson IV, 2004. "Do Long Work Hours Contribute to Divorce?," The B.E. Journal of Economic Analysis & Policy, Berkeley Electronic Press, vol. 0(1). [Downloadable!]
  15. Pierre-André Chiappori & Bernard Fortin & Guy Lacroix, 2001. "Marriage Market, Divorce Legislation and Household Labor Supply," CIRANO Working Papers 2001s-16, CIRANO. [Downloadable!]
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  16. Chun, Hyunbae & Lee, Injae, 2001. "Why Do Married Men Earn More: Productivity or Marriage Selection?," Economic Inquiry, Oxford University Press, vol. 39(2), pages 307-19, April.
  17. van der Klaauw, Wilbert, 1996. "Female Labour Supply and Marital Status Decisions: A Life-Cycle Model," Review of Economic Studies, Blackwell Publishing, vol. 63(2), pages 199-235, April. [Downloadable!] (restricted)
    Other versions:
  18. Lundberg, Shelly & Pollak, Robert A, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-58, Fall. [Downloadable!] (restricted)
  19. Allen, Douglas W, 1992. "Marriage and Divorce: Comment," American Economic Review, American Economic Association, vol. 82(3), pages 679-85, June. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  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:
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