An Equilibrium Analysis of Marriage, Divorce and Risk-Sharing
This paper considers family formation and reciprocity-based cooperation in the form of sharing of earnings-risk. While risk sharing is one benefit to marriage it is also limited by divorce risk. With search in the marriage market there may be multiple equilibria diering not only in divorce rates but also in the role of marriage in providing informal insurance. Publicly provided insurance, despite potential equilibrium multiplicity, is shown to aect family formation and financial cooperation monotonically. Some aspects of the model are then tested using international survey data and a bivariate probit model with sample selection.
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- Yoram Weiss, .
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University of Chicago - Population Research Center
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"On the State of the Union,"
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"Match Quality, New Information and Marital Dissolution,"
University of Chicago - Population Research Center
95-13, Chicago - Population Research Center.
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MPIDR Working Papers
WP-2001-004, Max Planck Institute for Demographic Research, Rostock, Germany.
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Keele Department of Economics Discussion Papers (1995-2001)
98/14, Department of Economics, Keele University.
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"Imperfect Commitment, Altruism, And The Family: Evidence From Transfer Behavior In Low-Income Rural Areas,"
The Review of Economics and Statistics,
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- Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-46, July-Aug..
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