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Savings and Economies of Marriage: Intra-Marriage Financial Distributions as Determinants of Savings

Author

Listed:
  • Shoshana Amyra Grossbard

    (Department of Economics,San Diego State University)

  • Alfredo Marvão Pereira

    (Department of Economics, The College of William and Mary)

Abstract

This paper presents an inter-temporal model of individual savings behavior with intra-marriage financial distributions and uncertainty about marriage and divorce. Spouses paying these distributions experience diseconomies of marriage; the spouses who receive them benefit from economies of marriage. We show that higher likelihoods of marriage and divorce are associated with lower (higher) personal savings rates in the presence of diseconomies (economies) of marriage. These results hint at the possibility that structural patterns of social behavior may be at the root of the lack of effectiveness of conventional policy instruments, such as tax incentives, to promote personal savings.

Suggested Citation

  • Shoshana Amyra Grossbard & Alfredo Marvão Pereira, 2013. "Savings and Economies of Marriage: Intra-Marriage Financial Distributions as Determinants of Savings," Working Papers 95, Department of Economics, College of William and Mary.
    • Handle: RePEc:cwm:wpaper:95
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    File URL: http://economics.wm.edu/wp/cwm_wp95rev1.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    savings behavior; marriage; divorce; economies of marriage; gender roles;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure

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