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Public Transfers and Marital Dissolution

In this paper we analyse determinants of marital dissolution. The focus is on the alleged influence from public transfers, including governmental transfers directed towards divorced families, child allowance, and child support awards. We use a Norwegian panel of 2.800 couples who were married in 1989, together with a broad range of socio-economic variables, including (expected) public and private transfers in case of divorce. The sample is observed over a six-year period, with the purpose of registering marital dissolution. Our findings are consistent with matching models where divorce is explained according to assortative mating hypothesis. We find that the level of transfers has a significantly positive effect on the divorce probability, and that the distribution of transfers in favour of the wife increases the same probability. The fact that internal re-distribution between spouses affects the divorce propensity is consistent with non-unitary family models, but at odds with the predictions from unitary and/or common wealth models.

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Paper provided by University of Bergen, Department of Economics in its series Working Papers in Economics with number 08/02.

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Length: 28 pages
Date of creation: 22 Mar 2002
Date of revision:
Handle: RePEc:hhs:bergec:2002_008
Contact details of provider: Postal: Institutt for økonomi, Universitetet i Bergen, Postboks 7802, 5020 Bergen, Norway
Phone: (+47)55589200
Fax: (+47)55589210
Web page: http://www.uib.no/econ/en
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  1. Robert A. Nakosteen & Olle Westerlund & Michael A. Zimmer, 2004. "Marital Matching and Earnings: Evidence from the Unmarried Population in Sweden," Journal of Human Resources, University of Wisconsin Press, vol. 39(4).
  2. William R. Johnson & Jonathan Skinner, 1988. "Accounting for Changes in the Labor Supply of Recently Divorced Women," Journal of Human Resources, University of Wisconsin Press, vol. 23(4), pages 417-436.
  3. Bratberg, Espen & Tjøtta, Sigve, 2002. "Income Effects of Divorce in Families with Dependent Children," Working Papers in Economics 20/02, University of Bergen, Department of Economics.
  4. Peters, H Elizabeth, 1992. "Marriage and Divorce: Reply," American Economic Review, American Economic Association, vol. 82(3), pages 687-93, June.
  5. Clark, Simon, 1999. "Law, Property, and Marital Dissolution," Economic Journal, Royal Economic Society, vol. 109(454), pages C41-54, March.
  6. Sarah Jarvis & Stephen P. Jenkins, 1997. "Marital Splits and Income Changes: Evidence for Britain," Papers iopeps97/26, Innocenti Occasional Papers, Economic Policy Series.
  7. Chiappori, P.A., 1989. "Collective Labour Supply and Welfare," DELTA Working Papers 89-07, DELTA (Ecole normale supérieure).
  8. Amy Farmer & Jill Tiefenthaler, 2003. "Strategic Bargaining Over Child Support and Visitation," Review of Economics of the Household, Springer, vol. 1(3), pages 205-218, September.
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  10. 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..
  11. Rees, Ray, 1988. "Taxation and the Household," Munich Reprints in Economics 3411, University of Munich, Department of Economics.
  12. Helmut Rainer, 2004. "Gender Discrimination and Effciency in Marriage: the Bargaining Family under Scrutiny," Economics Discussion Papers 586, University of Essex, Department of Economics.
  13. Shelly Lundberg & Robert A. Pollak, 2001. "Efficiency in Marriage," NBER Working Papers 8642, National Bureau of Economic Research, Inc.
  14. Jensen, Peter & Smith, Nina, 1990. "Unemployment and Marital Dissolution," Journal of Population Economics, Springer, vol. 3(3), pages 215-29, October.
  15. Cunha, Flavio & Heckman, James & Navarro, Salvador, 2004. "Separating uncertainty from heterogeneity in life cycle earnings," Working Paper Series 2005:6, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  16. Gary S. Becker, 1974. "A Theory of Marriage: Part II," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 11-26 National Bureau of Economic Research, Inc.
  17. Aloysius Siow, 1998. "Differential Fecundity, Markets, and Gender Roles," Journal of Political Economy, University of Chicago Press, vol. 106(2), pages 334-354, April.
  18. Apps, Patricia F. & Rees, Ray, 1988. "Taxation and the household," Journal of Public Economics, Elsevier, vol. 35(3), pages 355-369, April.
  19. Allen, Douglas W, 1992. "Marriage and Divorce: Comment," American Economic Review, American Economic Association, vol. 82(3), pages 679-85, June.
  20. Flinn, Christopher J, 2000. "Modes of Interaction between Divorced Parents," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(3), pages 545-78, August.
  21. Lommerund, K.E., 1997. "Battle of the Sexes: Non-Cooperative Games in the Theory of the Family," Norway; Department of Economics, University of Bergen 174, Department of Economics, University of Bergen.
  22. Lundberg, Shelly & Pollak, Robert A, 1994. "Noncooperative Bargaining Models of Marriage," American Economic Review, American Economic Association, vol. 84(2), pages 132-37, May.
  23. Chiappori, Pierre-Andre, 1988. "Rational Household Labor Supply," Econometrica, Econometric Society, vol. 56(1), pages 63-90, January.
  24. Becker, Gary S & Landes, Elisabeth M & Michael, Robert T, 1977. "An Economic Analysis of Marital Instability," Journal of Political Economy, University of Chicago Press, vol. 85(6), pages 1141-87, December.
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