Do Alimony Regulations Matter Inside Marriage? Evidence from the 2008 Reform of the German Maintenance Law

Marianna Schaubert ()
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Marianna Schaubert: Fraunhofer Institute for Applied Information Technology FIT

Journal of Labor Research, 2023, vol. 44, issue 1, No 5, 145-178

Abstract: Abstract This study investigates how West German spouses have responded to the alimony reform introduced in 2008. This reform imposed financial self-responsibility after a finalized divorce. It weakened the relative bargaining position of the spouse with a claim for maintenance in the case of a potential divorce before the law change. Therefore, the present study helps to verify bargaining models by considering this policy change as a shift of spousal bargaining power. Estimating difference-in-differences models, I find that, indeed, wives who face a potential alimony loss might have increased their working hours as a result of the 2008 reform. Thus, this finding suggests that family law may affect labor market outcomes. To my knowledge, the present investigation is the first analysis of the behavioral response of individuals in longer marriages to this change in alimony law. Its approach to identifying those who have been (dis)advantaged by this reform is a new one, proposing a method that reflects the realities of alimony arrangements.

Keywords: Alimony; Marriage; Intra-household bargaining; Institutional change; Labor supply; Time allocation (search for similar items in EconPapers)
JEL-codes: D13 J12 J13 J22 K36 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s12122-022-09340-3

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