Advanced Search
MyIDEAS: Login

Female Labor Supply and Divorce: New Evidence from Ireland

Contents:

Author Info

  • Bargain, Olivier

    ()
    (University of Aix-Marseille II)

  • Gonzalez, Libertad

    ()
    (Universitat Pompeu Fabra)

  • Keane, Claire

    ()
    (ESRI, Dublin)

  • Özcan, Berkay

    ()
    (Yale University)

Abstract

If participation in the labor market helps to secure women's outside options in the case of divorce/separation, an increase in the perceived risk of marital dissolution may accelerate the increase in female labor supply. This simple prediction has been tested in the literature using time and/or spatial variation in divorce legislation (e.g., across US states), leading to mixed results. In this paper, we suggest testing this hypothesis by exploiting a more radical policy change, i.e., the legalization of divorce. In Ireland, the right to divorce was introduced in 1996, followed by an acceleration of marriage breakdown rates. We use this fundamental change in the Irish society as a natural experiment. We follow a difference-in-difference approach, using families for whom the dissolution risk is small as a control group. Our results suggest that the legalization of divorce contributed to a significant increase in female labor supply, mostly at the extensive margin. Results are not driven by selection and are robust to several specification checks, including the introduction of household fixed effects and an improved match between control and treatment groups using propensity score reweighting.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://ftp.iza.org/dp4959.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4959.

as in new window
Length: 31 pages
Date of creation: May 2010
Date of revision:
Publication status: published in: European Economic Review, 2012, 56 (8), 1675–1691
Handle: RePEc:iza:izadps:dp4959

Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org

Order Information:
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Email:

Related research

Keywords: divorce law; natural experiment; labor supply; fixed effects; propensity score;

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

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.:
as in new window
  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).
  2. Mueller, Richard E., 2005. "The effect of marital dissolution on the labour supply of males and females: Evidence from Canada," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 34(6), pages 787-809, December.
  3. Martin Browning & Mette Gørtz, 2012. "Spending Time and Money within the Household," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(3), pages 681-704, 09.
  4. A. Smith, Jeffrey & E. Todd, Petra, 2005. "Does matching overcome LaLonde's critique of nonexperimental estimators?," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 305-353.
  5. Betsey Stevenson & Justin Wolfers, 2006. "Bargaining in the Shadow of the Law: Divorce Laws and Family Distress," The Quarterly Journal of Economics, MIT Press, vol. 121(1), pages 267-288, 02.
  6. Gray, Jeffrey S, 1998. "Divorce-Law Changes, Household Bargaining, and Married Women's Labor Supply," American Economic Review, American Economic Association, vol. 88(3), pages 628-42, June.
  7. Lehrer, Evelyn L., 2009. "Religion, Human Capital Investments and the Family in the United States," IZA Discussion Papers 4279, Institute for the Study of Labor (IZA).
  8. Gonzalez, Libertad & Viitanen, Tarja, 2006. "The Effect of Divorce Laws on Divorce Rates in Europe," IZA Discussion Papers 2023, Institute for the Study of Labor (IZA).
  9. Peters, H Elizabeth, 1992. "Marriage and Divorce: Reply," American Economic Review, American Economic Association, vol. 82(3), pages 687-93, June.
  10. Dale Bremmer & Randy Kesselring, 2004. "Divorce and female labor force participation: Evidence from times-series data and cointegration," Atlantic Economic Journal, International Atlantic Economic Society, vol. 32(3), pages 175-190, September.
  11. Ai, Chunrong & Norton, Edward C., 2003. "Interaction terms in logit and probit models," Economics Letters, Elsevier, vol. 80(1), pages 123-129, July.
  12. Betsey Stevenson, 2006. "The impact of divorce laws on marriage-specific capital," Working Paper Series 2006-43, Federal Reserve Bank of San Francisco.
  13. Parkman, Allen M, 1992. "Unilateral Divorce and the Labor-Force Participation Rate of Married Women, Revisited," American Economic Review, American Economic Association, vol. 82(3), pages 671-78, June.
  14. Laurence R. Iannaccone, 1998. "Corrigenda [Introduction to the Economics of Religion]," Journal of Economic Literature, American Economic Association, vol. 36(4), pages 1941-1941, December.
  15. R. Alessie & Thomas F. Crossley & Vincent Hildebrand, 2006. "Estimating a collective household model with survey data on financial satisfaction," Working Papers 06-07, Utrecht School of Economics.
  16. Blundell, Richard & Macurdy, Thomas, 1999. "Labor supply: A review of alternative approaches," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 27, pages 1559-1695 Elsevier.
  17. Libertad Gonzalez & Tarja Viitanen, 2009. "The Long Term Effects of Legalizing Divorce on Children," Working Papers 0901, University of Otago, Department of Economics, revised Jan 2009.
  18. Pierre-Andre Chiappori & Bernard Fortin & Guy Lacroix, 2002. "Marriage Market, Divorce Legislation, and Household Labor Supply," Journal of Political Economy, University of Chicago Press, vol. 110(1), pages 37-72, February.
  19. 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 1141-87, December.
  20. Giulio Fella & Paola Manzini & Marco Mariotti, 2004. "Does Divorce Law Matter?," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 607-633, 06.
  21. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1.
  22. Justin Wolfers, 2006. "Did Unilateral Divorce Laws Raise Divorce Rates? A Reconciliation and New Results," American Economic Review, American Economic Association, vol. 96(5), pages 1802-1820, December.
  23. Tim Callan & Arthur van Soest & John R. Walsh, 2009. "Tax Structure and Female Labour Supply: Evidence from Ireland," LABOUR, CEIS, vol. 23(1), pages 1-35, 03.
  24. Sergio Firpo, 2007. "Efficient Semiparametric Estimation of Quantile Treatment Effects," Econometrica, Econometric Society, vol. 75(1), pages 259-276, 01.
  25. Sen, Bisakha, 2000. "How important is anticipation of divorce in married women's labor supply decisions? An intercohort comparison using NLS data," Economics Letters, Elsevier, vol. 67(2), pages 209-216, May.
  26. Allen, Douglas W, 1992. "Marriage and Divorce: Comment," American Economic Review, American Economic Association, vol. 82(3), pages 679-85, June.
  27. Puhani, Patrick A., 2012. "The treatment effect, the cross difference, and the interaction term in nonlinear “difference-in-differences” models," Economics Letters, Elsevier, vol. 115(1), pages 85-87.
  28. Katie R. Genadek & Wendy A. Stock & Christiana Stoddard, 2007. "No-Fault Divorce Laws and the Labor Supply of Women with and without Children," Journal of Human Resources, University of Wisconsin Press, vol. 42(1).
  29. Betsey Stevenson, 2008. "Divorce Law and Women's Labor Supply," NBER Working Papers 14346, National Bureau of Economic Research, Inc.
  30. repec:hal:cesptp:halshs-00497439 is not listed on IDEAS
  31. Victor Hiller & Magali Recoules, 2010. "Divorce decisions, divorce laws and social norms," Documents de travail du Centre d'Economie de la Sorbonne 10046, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
  32. Shelly Lundberg & Elaina Rose, 1999. "The Determinants of Specialization within Marriage," Working Papers UWEC-2005-07, University of Washington, Department of Economics.
  33. El Lahga, AbdelRahmen & Moreau, Nicolas, 2007. "The Effects of Marriage on Couples’ Allocation of Time Between Market and Non-Market Hours," IZA Discussion Papers 2619, Institute for the Study of Labor (IZA).
  34. Papps, Kerry L., 2006. "The Effects of Divorce Risk on the Labour Supply of Married Couples," IZA Discussion Papers 2395, Institute for the Study of Labor (IZA).
  35. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-46, July-Aug..
  36. Laurence R. Iannaccone, 1998. "Introduction to the Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1465-1495, September.
  37. 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.
  38. Johnson, William R & Skinner, Jonathan, 1986. "Labor Supply and Marital Separation," American Economic Review, American Economic Association, vol. 76(3), pages 455-69, June.
  39. Leora Friedberg, 1998. "Did Unilateral Divorce Raise Divorce Rates? Evidence from Panel Data," NBER Working Papers 6398, National Bureau of Economic Research, Inc.
  40. Jonathan Gruber, 2004. "Is Making Divorce Easier Bad for Children? The Long-Run Implications of Unilateral Divorce," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 799-834, October.
  41. Allen, Douglas W., 1998. "No-fault divorce in Canada: Its cause and effect," Journal of Economic Behavior & Organization, Elsevier, vol. 37(2), pages 129-149, October.
  42. Doris, Aedin, 2001. "The Changing Responsiveness of Labour Supply during the 1990s," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2001(4-Decembe), pages 1-14.
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 in new window

Cited by:
  1. Alessandro Cigno, 2011. "The Economics of Marriage," Working Paper Series 11_11, The Rimini Centre for Economic Analysis.
  2. Clement Joubert & Sekyu Choi, 2012. "The value of remarriage," 2012 Meeting Papers 1111, Society for Economic Dynamics.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4959. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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