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Marriage Market, Divorce Legislation and Household Labor Supply

  • Chiappori, Pierre-André
  • Fortin, Bernard
  • Lacroix, Guy

This paper provides a theoretical framework for analyzing the impact of the marriage market and divorce legislation on household labor supply. In our approach, the sex ratio on the marriage market and the rules governing divorce are examples of "distribution factors". The latter are defined as variables that affect the household members' bargaining position but neither preferences nor the joint budget set. We extend the collective labor supply model developed by Chiappori (JPE, 1992) to allow for distribution factors. We show that our model imposes new restrictions on the labor supply functions and eases the identification of individual preferences and the intra-household decision process. The model is estimated using PSID data for the year 1988. Our results do not reject the restrictions imposed by the model. Also, the sex ratio and divorce laws deemed favorable to women are found to impact the labor supply behavior and the decision process in the directions predicted by the theory and to have sizeable effects.

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File URL: http://www.ecn.ulaval.ca/w3/recherche/cahiers/2001/0103.pdf
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Paper provided by Université Laval - Département d'économique in its series Cahiers de recherche with number 0103.

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Date of creation: 2001
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Handle: RePEc:lvl:laeccr:0103
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  1. Thomas, D., 1989. "Intra-Household Resource Allocation: An Inferential Approach," Papers 586, Yale - Economic Growth Center.
  2. Martin Browning & P.A. Chiappori, 1996. "Efficient Intra-Household Allocations - A General Characterization and Empirical Tests," Discussion Papers 96-10, University of Copenhagen. Department of Economics.
  3. Ellman, Ira Mark & Lohr, Sharon L., 1998. "Dissolving the relationship between divorce laws and divorce rates," International Review of Law and Economics, Elsevier, vol. 18(3), pages 341-359, September.
  4. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1, August.
  5. Thomas Mroz, . "The Sensitivity of an Empirical Model of Married Women's Hours of Work to Economic and Statistical Assumptions," University of Chicago - Population Research Center 84-8, Chicago - Population Research Center.
  6. Fortin, Bernard & Lacroix, Guy, 1997. "A Test of the Unitary and Collective Models of Household Labour Supply," Economic Journal, Royal Economic Society, vol. 107(443), pages 933-55, July.
  7. Richard Blundell & Pierre-Andr� Chiappori & Costas Meghir, 2005. "Collective Labor Supply with Children," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1277-1306, December.
  8. Chiappori, Pierre-Andre, 1988. "Rational Household Labor Supply," Econometrica, Econometric Society, vol. 56(1), pages 63-90, January.
  9. Lundberg, Shelly J, 1988. "Labor Supply of Husbands and Wives: A Simultaneous Equations Approach," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 224-35, May.
  10. Blundell, Richard William & Ham, John & Meghir, Costas, 1987. "Unemployment and Female Labour Supply," CEPR Discussion Papers 149, C.E.P.R. Discussion Papers.
  11. Esther Duflo, 2003. "Grandmothers and Granddaughters: Old-Age Pensions and Intrahousehold Allocation in South Africa," World Bank Economic Review, World Bank Group, vol. 17(1), pages 1-25, June.
  12. Peters, H Elizabeth, 1986. "Marriage and Divorce: Informational Constraints and Private Contracting," American Economic Review, American Economic Association, vol. 76(3), pages 437-54, June.
  13. Chiappori, P.A., 1989. "Collective Labour Supply and Welfare," DELTA Working Papers 89-07, DELTA (Ecole normale supérieure).
  14. Lundberg, Shelly & Pollak, Robert A, 1994. "Noncooperative Bargaining Models of Marriage," American Economic Review, American Economic Association, vol. 84(2), pages 132-37, May.
  15. Manser, Marilyn & Brown, Murray, 1980. "Marriage and Household Decision-Making: A Bargaining Analysis," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 21(1), pages 31-44, February.
  16. Lundberg, S. & Pollak, R.A., 1991. "Separate Spheres Bargaining and the Marriage Market," Working Papers 91-08, University of Washington, Department of Economics.
  17. McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-49, June.
  18. Rubalcava, L. & Thomas, D., 2000. "Family Bargaining and Welfare," Papers 00-10, RAND - Labor and Population Program.
  19. Marianne Bertrand & Sendhil Mullainathan & Douglas Miller, 2003. "Public Policy and Extended Families: Evidence from Pensions in South Africa," World Bank Economic Review, World Bank Group, vol. 17(1), pages 27-50, June.
  20. Blundell, Richard & Walker, Ian, 1986. "A Life-Cycle Consistent Empirical Model of Family Labour Supply Using Cross-Section Data," Review of Economic Studies, Wiley Blackwell, vol. 53(4), pages 539-58, August.
  21. Udry, Christopher, 1996. "Gender, Agricultural Production, and the Theory of the Household," Journal of Political Economy, University of Chicago Press, vol. 104(5), pages 1010-46, October.
  22. Josh Angrist, 2000. "Consequences of Imbalanced Sex Ratios: Evidence from America's Second Generation," NBER Working Papers 8042, National Bureau of Economic Research, Inc.
  23. Leora Friedberg, 1998. "Did Unilateral Divorce Raise Divorce Rates? Evidence from Panel Data," NBER Working Papers 6398, National Bureau of Economic Research, Inc.
  24. Gray, Jeffrey S, 1998. "Divorce-Law Changes, Household Bargaining, and Married Women's Labor Supply," American Economic Review, American Economic Association, vol. 88(3), pages 628-42, June.
  25. Marianne Bertrand & Douglas Miller & Sendhil Mullainathan, 1999. "Public Policy and Extended Families: Evidence from South Africa," Working Papers 801, Princeton University, Department of Economics, Industrial Relations Section..
  26. Parkman, Allen M, 1992. "Unilateral Divorce and the Labor-Force Participation Rate of Married Women, Revisited," American Economic Review, American Economic Association, vol. 82(3), pages 671-78, June.
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