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Exit and Voice in a Marriage Market

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Author Info

  • Akiko Maruyama

    ()
    (National Graduate Institute for Policy Studies (GRIPS))

  • Takashi Shimizu

    ()
    (Faculty of Economics, Kansai University)

  • Kazuhiro Yamamoto

    ()
    (Graduate School of Economics, Osaka University)

Abstract

In this paper, we present a model in which agents choose voice, exit, or stay options when their marital condition becomes bad. The "voice" option can be interpreted as a spouse's effort or "investment" in the household to resolve his/her dissatisfaction and improve the marital condition. If a spouse hopes to divorce, he/she chooses the "exit" option. If a spouse does not hope to express his/her opinion and divorce, he/she chooses the "stay" option. We focus on the role of "exit" and "voice" in a marriage and investigate the effects of a divorce law that is based on fault or no-fault on divorce rates. Our study shows that divorce rates tend to be too high under a unilateral divorce law in the non-transferable utility case. On the other hand, mutual-consent divorce law generates multiple equilibria, and divorce rates are then inefficient even in the transferable utility case. In this multiple equilibrium case, divorce rates are determined by social factors, such as culture, norm, and religion.

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Bibliographic Info

Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 09-04-Rev.

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Length: 33 pages
Date of creation: Feb 2009
Date of revision: Mar 2009
Handle: RePEc:osk:wpaper:0904r

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Web page: http://www.econ.osaka-u.ac.jp/
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Keywords: Exit; Voice; Divorce law;

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References

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  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.
  2. Allen, Douglas W, 1992. "Marriage and Divorce: Comment," American Economic Review, American Economic Association, vol. 82(3), pages 679-85, June.
  3. Leslie M. Marx & Jeroen M. Swinkels, 1996. "Order Independence for Iterated Weak Dominance," Discussion Papers 1066R, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  4. Wolfers, Justin, 2003. "Did Unilateral Divorce Laws Raise Divorce Rates? A Reconciliation and New Results," Research Papers 1819, Stanford University, Graduate School of Business.
  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. 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.
  7. 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.
  8. Niko Matouschek & Imran Rasul, 2008. "The Economics of the Marriage Contract: Theories and Evidence," Journal of Law and Economics, University of Chicago Press, vol. 51(1), pages 59-110, 02.
  9. Zelder, Martin, 1993. "Inefficient Dissolutions as a Consequence of Public Goods: The Case of No-Fault Divorce," The Journal of Legal Studies, University of Chicago Press, vol. 22(2), pages 503-20, June.
  10. McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-49, June.
  11. Clark, Simon, 1999. "Law, Property, and Marital Dissolution," Economic Journal, Royal Economic Society, vol. 109(454), pages C41-54, March.
  12. Manser, Marilyn & Brown, Murray, 1980. "Marriage and Household Decision-Making: A Bargaining Analysis," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 21(1), pages 31-44, February.
  13. Leora Friedberg, 1998. "Did Unilateral Divorce Raise Divorce Rates? Evidence from Panel Data," NBER Working Papers 6398, National Bureau of Economic Research, Inc.
  14. Imran Rasul, 2006. "Marriage Markets and Divorce Laws," Journal of Law, Economics and Organization, Oxford University Press, vol. 22(1), pages 30-69, April.
  15. Betsey Stevenson, 2006. "The impact of divorce laws on marriage-specific capital," Working Paper Series 2006-43, Federal Reserve Bank of San Francisco.
  16. Dale T. Mortensen & Christopher A. Pissarides, 1993. "Job Creation and Job Destruction in the Theory of Unemployment," CEP Discussion Papers dp0110, Centre for Economic Performance, LSE.
  17. 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.
  18. Peters, H Elizabeth, 1992. "Marriage and Divorce: Reply," American Economic Review, American Economic Association, vol. 82(3), pages 687-93, June.
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