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Male Wage Inequality and Marital Dissolution: Is There a Link?

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Listed author(s):
  • Bellou, Andriana

    ()

    (University of Montreal)

Abstract

After almost a century-long pattern of rising marital instability, divorce rates leveled off in 1980 and have been declining ever since. The timing of deceleration and decline in the rates of marital disruption interestingly coincides with a period of substantial growth in wage inequality. This paper establishes a connection between the two phenomena and explores potential explanations for the underlying link. Using individual data on female marital histories in a duration analysis framework combined with regional and temporal variation in the pattern of male wage dispersion, I show that inequality has a significant stabilizing effect on the marital relationship. Quantitatively, increases in male wage dispersion can roughly explain up to 30% of the fall in the mean separation probability between 1979 and 1990. Several plausible explanations for this relationship are assessed: changes in spousal labor supplies, female wage inequality, income uncertainty, social capital as well as a hypothesis of "on-the-marriage" search. The results are most supportive of the search interpretation. No strong quantitative support was found for the remaining mechanisms.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7331.

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Length: 52 pages
Date of creation: Apr 2013
Publication status: forthcoming in: Canadian Journal of Economics, 2016
Handle: RePEc:iza:izadps:dp7331
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Keywords: wage inequality; divorce;

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Find related papers by JEL classification:
  • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
  • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
  • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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  1. Gregory D. Hess, 2004. "Marriage and Consumption Insurance: What's Love Got to Do with It?," Journal of Political Economy, University of Chicago Press, vol. 112(2), pages 290-318, April.
  2. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1251-1288.
  3. Frankel, David M. & Gould, Eric D., 2001. "The Retail Price of Inequality," Journal of Urban Economics, Elsevier, vol. 49(2), pages 219-239, March.
  4. Betsey Stevenson & Justin Wolfers, 2007. "Marriage and Divorce: Changes and their Driving Forces," Journal of Economic Perspectives, American Economic Association, vol. 21(2), pages 27-52, Spring.
  5. Joshua Goldstein, 1999. "The leveling of divorce in the united states," Demography, Springer;Population Association of America (PAA), vol. 36(3), pages 409-414, August.
  6. 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 1141-1187, December.
  7. Hey, John D & McKenna, Chris J, 1979. "To Move or Not to Move?," Economica, London School of Economics and Political Science, vol. 46(182), pages 175-185, May.
  8. Terra G. McKinnish, 2007. "Sexually Integrated Workplaces and Divorce: Another Form of On-the-Job Search," Journal of Human Resources, University of Wisconsin Press, vol. 42(2).
  9. Eric D. Gould & Bruce A. Weinberg & David B. Mustard, 2002. "Crime Rates And Local Labor Market Opportunities In The United States: 1979-1997," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 45-61, February.
  10. Johnson, William R & Skinner, Jonathan, 1986. "Labor Supply and Marital Separation," American Economic Review, American Economic Association, vol. 76(3), pages 455-469, June.
  11. Brigitte C. Madrian & Lars John Lefgren, 1999. "A Note on Longitudinally Matching Current Population Survey (CPS) Respondents," NBER Technical Working Papers 0247, National Bureau of Economic Research, Inc.
  12. Chiswick, Carmel U & Lehrer, Evelyn L, 1990. "On Marriage-Specific Human Capital: Its Role as a Determinant of Remarriage," Journal of Population Economics, Springer;European Society for Population Economics, vol. 3(3), pages 193-213, October.
  13. Kerwin Kofi Charles & Melvin Stephens, 2004. "Job Displacement, Disability, and Divorce," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 489-522, April.
  14. David S. Lee, 1999. "Wage Inequality in the United States During the 1980s: Rising Dispersion or Falling Minimum Wage?," The Quarterly Journal of Economics, Oxford University Press, vol. 114(3), pages 977-1023.
  15. Martha J. Bailey, 2006. "More Power to the Pill: The Impact of Contraceptive Freedom on Women's Life Cycle Labor Supply," The Quarterly Journal of Economics, Oxford University Press, vol. 121(1), pages 289-320.
  16. Dora L. Costa & Matthew E. Kahn, 2003. "Understanding the American Decline in Social Capital, 1952--1998," Kyklos, Wiley Blackwell, vol. 56(1), pages 17-46, February.
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Cited by:

  1. Berthold, Norbert & Gründler, Klaus, 2014. "On the empirics of social mobility: A macroeconomic approach," Discussion Paper Series 128, Julius Maximilian University of Würzburg, Chair of Economic Order and Social Policy.
  2. Sonia Oreffice & Climent Quintana-Domeque, 2012. "A Matter of Weight? The Role of Spouses. Physical Attractiveness on Hours of Work," CHILD Working Papers Series 7, Centre for Household, Income, Labour and Demographic Economics (CHILD) - CCA.
  3. Sonia Oreffice & Climent Quintana-Domeque, 2012. "Fat spouses and hours of work: are body and Pareto weights correlated?," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-21, December.
  4. Berthold Norbert & Gründler Klaus, 2014. "Empirie sozialer Mobilität und wirtschaftspolitische Implikationen / The Determinants of Social Mobility and their Implications for Economic Policy," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 65(1), pages 279-302, January.

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