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On the State of the Union

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Author Info

  • Aiyagari, S.R.
  • Greenwood, J.
  • Guner, N.

Abstract

An overlapping generations model of marriage and divorce is constructed to analyze family structure and intergenerational mobility. Agents differ by sex, marital status, and human capital. Single agents meet in a marriage market and decide whether to accept or reject proposals to wed. Married couples must decide whether to separate or not. Parents invested in their children depending on their wherewithal. A simulated version of the theoretical prototype can generate an equilibrium with a significant number of female-headed families and a high degree of persistence in income across generations. To illustrate the model's mechanics, the effects of two anti-poverty policies, namely child support and welfare, are investigated.

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Bibliographic Info

Paper provided by University of Rochester - Center for Economic Research (RCER) in its series RCER Working Papers with number 462.

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Length: 42 pages
Date of creation: 1999
Date of revision:
Publication status: Published in JPE (2000)
Handle: RePEc:roc:rocher:462

Contact details of provider:
Postal: University of Rochester, Center for Economic Research, Department of Economics, Harkness 231 Rochester, New York 14627 U.S.A.

Related research

Keywords: MARRIAGE ; DIVORCE ; PUBLIC POLICY ; ECONOMIC MODELS;

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