The economics of the marriage contract: Theories and evidence

Niko Matouschek*, Imran Rasul

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

48 Scopus citations

Abstract

We analyze the role of the marriage contract. We first formalize three prominent hypotheses on why people marry: marriage provides an exogenous payoff to married partners, it serves as a commitment device, and it serves as a signaling device. For each theory we analyze how a reduction in the costs of divorce affects the propensity to divorce for couples at any given duration of marriage. We then use individual marriage and divorce certificate data from the United States to bring these alternative views of the marriage contract to bear on the data. We exploit variations in the timing of the adoption of unilateral divorce laws across states to proxy a one-off and permanent reduction in divorce costs. The results suggest that the dominant reason that couples enter into a marriage contract is that it serves as a commitment device.

Original languageEnglish (US)
Pages (from-to)59-110
Number of pages52
JournalJournal of Law and Economics
Volume51
Issue number1
DOIs
StatePublished - Feb 1 2008

ASJC Scopus subject areas

  • Economics and Econometrics
  • Law

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