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Job Displacement, Disability, and Divorce

  • Kerwin Kofi Charles

    (University of Michigan and National Bureau of Economic Research)

  • Melvin Stephens

    (Carnegie Mellon University and National Bureau of Economic Research)

Earnings shocks should affect divorce probability by changing a couple's expected gains from marriage. We find that the divorce hazard rises after a spouse's job displacement but does not change after a spousal disability. This difference casts doubt on a purely pecuniary motivation for divorce following earnings shocks, since both types of shocks exhibit similar long-run economic consequences. Furthermore, the increase in divorce is found only for layoffs and not for plant closings, suggesting that information conveyed about a partner's noneconomic suitability as a mate due to a job loss may be more important than financial losses in precipitating divorce.

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Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 22 (2004)
Issue (Month): 2 (April)
Pages: 489-522

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Handle: RePEc:ucp:jlabec:v:22:y:2004:i:2:p:489-522
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  18. Peters, H Elizabeth, 1993. "The Importance of Financial Considerations in Divorce Decisions," Economic Inquiry, Western Economic Association International, vol. 31(1), pages 71-86, January.
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