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'Til Recession Do Us Part: Booms, Busts, and Divorce in the United States

Author

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  • Chowdhury, Abdur

    (Department of Economics Marquette University)

Abstract

A general hypothesis regarding the impact of permanent income levels and business cycle fluctuations on divorce rate at the state level in the United States is analyzed in the paper. Using data for 45 states over the 1978-2009 sample period, the paper shows that the higher the level of transitory income, the higher is the incidence of divorce. In other words, divorce is pro-cyclical. Why do divorce decrease during recession and increase during expansion? When an economy is in crisis and people's incomes are low, the cost of divorce will prevent a couple from divorcing irrespective of the quality of their marriage. In this case, divorce is not an effective option. Extending this reasoning to the Great Recession of 2007-9, it can be argued that scarce employment opportunities and reductions in the value of martial assets had forced couples to remain together, notwithstanding marital difficulties. As the economy moved into a slow and moderate recovery beginning in mid-2009, this pent-up demand for divorce was released and the rates increased. That, in large part, is why divorce generally follow a "pro-cyclical" course, fluctuating in sympathy with the economy.

Suggested Citation

  • Chowdhury, Abdur, 2011. "'Til Recession Do Us Part: Booms, Busts, and Divorce in the United States," Working Papers and Research 2011-05, Marquette University, Center for Global and Economic Studies and Department of Economics.
    • Handle: RePEc:mrq:wpaper:2011-05
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    File URL: http://epublications.marquette.edu/econ_workingpapers/16
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    Cited by:

    1. Mohammad Reza Farzanegan & Hassan Fereidouni Gholipour, 2016. "Divorce and the cost of housing: evidence from Iran," Review of Economics of the Household, Springer, vol. 14(4), pages 1029-1054, December.
    2. Lauren Hoehn-Velasco & Jose Roberto Balmori de la Miyar & Adan Silverio-Murillo & Sherajum Monira Farin, 2023. "Marriage and divorce during a pandemic: the impact of the COVID-19 pandemic on marital formation and dissolution in Mexico," Review of Economics of the Household, Springer, vol. 21(3), pages 757-788, September.
    3. 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.
    4. Mohammad Reza Farzanegan & Sven Fischer, 2023. "The Impact of the COVID-19 Pandemic on Marriage and Childbirth: Survey-based Evidence from Iran," MAGKS Papers on Economics 202320, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Marjanovic, Zdravko & Fiksenbaum, Lisa & Greenglass, Esther, 2018. "Financial threat correlates with acute economic hardship and behavioral intentions that can improve one's personal finances and health," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 77(C), pages 151-157.
    6. Johanna Catherine Maclean & Reginald Covington & Asia Sikora Kessler, 2016. "Labor Market Conditions At School-Leaving: Long-Run Effects On Marriage And Fertility," Contemporary Economic Policy, Western Economic Association International, vol. 34(1), pages 63-88, January.
    7. Jennifer Klein, 2017. "House Price Shocks and Individual Divorce Risk in the United States," Journal of Family and Economic Issues, Springer, vol. 38(4), pages 628-649, December.

    More about this item

    Keywords

    divorce; business cycle; Great Recession;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure

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