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The Effects of Marriage and Divorce on Financial Investments: Learning to Love or Hate Risk?


  • Charlotte Christiansen

    () (School of Economics and Management, Aarhus University and CREATES)

  • Juanna Schröter Joensen

    () (Stockholm School of Economics)

  • Jesper Rangvid

    () (Department of Finance, Copenhagen Business School)


We investigate how changes in marital status affect the decision to take on financial risks. As an alternative to the traditional approach of comparing different groups of investors (men and women) at each point in time, we use a difference-in-differences estimation strategy to compare how the same individual invests at different points in time (before and after marriage or divorce) compared to a benchmark investor, thereby controlling for unobserved systematic differences as well as various background characteristics. We investigate both the propensity to participate in the stock market and the propensity to invest in more risky portfolios. We find that marriage acts as a financial risk-reducer for men and as a financial risk-increaser for women, in the sense that women increase the fraction of wealth invested in stocks after marriage and decrease it after divorce, whereas men show the opposite investment behavior.

Suggested Citation

  • Charlotte Christiansen & Juanna Schröter Joensen & Jesper Rangvid, 2010. "The Effects of Marriage and Divorce on Financial Investments: Learning to Love or Hate Risk?," CREATES Research Papers 2010-57, Department of Economics and Business Economics, Aarhus University.
  • Handle: RePEc:aah:create:2010-57

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    Cited by:

    1. Atella, Vincenzo & Brunetti, Marianna & Maestas, Nicole, 2012. "Household portfolio choices, health status and health care systems: A cross-country analysis based on SHARE," Journal of Banking & Finance, Elsevier, vol. 36(5), pages 1320-1335.
    2. Hibbert, Ann Marie & Lawrence, Edward R. & Prakash, Arun J., 2013. "Does knowledge of finance mitigate the gender difference in financial risk-aversion?," Global Finance Journal, Elsevier, vol. 24(2), pages 140-152.

    More about this item


    Gender; Marriage; Divorce; Difference-in-differences; Stock market participation; Portfolio choice.;

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance


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