Free to Leave? A Welfare Analysis of Divorce Regimes

Raquel Fernández and Joyce Cheng Wong

American Economic Journal: Macroeconomics, 2017, vol. 9, issue 3, 72-115

Abstract: During the 1970s, the United States switched from mutual consent to a unilateral divorce regime. Who benefited/lost from this change? We develop a dynamic life cycle model in which agents make consumption, saving, work, and marital-status decisions under a given divorce regime. Calibrating the model to match key moments for the 1940 cohort and conditioning solely on gender, our ex ante welfare analysis finds that women fare better under mutual consent whereas men prefer a unilateral system. Conditioning as well on initial productivity (expected income), we find that the top three quintiles of men and the top two quintiles of women prefer unilateral divorce.

JEL-codes: D91 J12 J16 K36 (search for similar items in EconPapers)
Date: 2017
Note: DOI: 10.1257/mac.20150293
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Citations: View citations in EconPapers (28)

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