Marriage and Divorce

Basic Facts
 Marriage and divorce
The last century has been characterized by substantial changes in family structure (Figure 1). More men and women are now divorced and unmarried or
have alternative arrangements, such as cohabitation. Interestingly, the rise in
divorce rates is associated with an increase in remarriage rates (relative to first
∗
Prepared for Palgrave Dictionary of Economics, Second Edition.
†
Eitan Berglas School of Economics, Tel-Aviv University. e-mai: weiss@tau.ac.il
1marriage rates), reflecting higher turnover. Most people had a first marriage,
and most divorces end in remarriage. Moreover, the remarriage rate is above
the first marriage rate and far exceeds the divorce rate, suggesting that, despite
the larger turnover, marriage is still a ”natural” state (Table 1). Women enter
the first marriage faster than men. However, following divorce, men remarry at
higher rates than women, especially at old ages. This pattern reflects the earlier
marriage of women and their longer life that cause the ratio of men to women
to decline with age.
One consequence of higher marital turnover is the large number of children
who live in single parent and step parent households. In 2002, 23 percent of
US children less than 18 years old lived only with their mother and 5 percent
lived only with their father. Children of broken families are more likely to live
in poverty and under-perform in school. Lower attainments of such children are
observed also prior to the occurrence of divorce, suggesting that bad marriage
rather than divorce may be the cause (Piketty, 2001).
 Marriage and work
Time use data (Table 2) show that men work more than women in the market;
women do more housework than men. Per day, single women work at home 3
hours while single men work less than 2 hours. These figures roughly double
for married couples with young children, showing clearly that children require
a substantial investment of time and that most of this load is taken by the
mother. The total time worked and the corresponding amount of leisure is
about the same for married men and women.
Figure 2 displays the work patterns within couples. The most common
situation is that the husband works full time and the wife works part time or
does not work at all. However, the proportion of such couples has declined and
the proportion of couples where both partners work full time has risen sharply,
reflecting the increased entry of married women into the labor force.
Marriage and wages
Male female wage differences of full time workers are larger among married than
among single persons. Married men have consistently the highest wage among
men, while never married women have the highest wage among women. The
wage gap between married men and women rises as the cohort ages, reflecting
the cumulative effects of gender differences in the acquisition of labor market
experience (Figures 3, 4). The increased participation of married women, associated with the increase in their wages has increased their wage relative to never
married women and relative to their husbands (Table 3).
 Economic theory of marriage and divorce
From an economic point of view, marriage is a voluntary partnership for the
purpose of joint production and joint consumption. As such, it is comparable
to other economic organizations that aim to maximize some private gains, but
are subject to market discipline.
Gains from marriage
Consumption and production in the family are broadly defined to include non
marketable goods and services, such as companionship and children. Indeed,
the production and rearing of children is the most commonly recognized role of
the family. We mention here five broad sources of economic gain from marriage.
i.e., why "two are better than one":
1) Sharing of collective (non rival) goods; both partners can equally enjoy
their children, share the same information and use the same home.
2) Division of labor to exploit comparative advantage or increasing returns;
one partner works at home and the other works in the market.
3) Extending credit and coordination of investment activities; one partner
works when the other is in school.
4) Risk pooling; one partner works when the other is sick or unemployed.
5) Coordination of child care, which is a collective good for the parents. Although children can be produced and raised outside the family, the family has a
substantial advantage in carrying out these activities. Two inter-related factors
cause this advantage: by nature, parents care about their own children and,
because of this mutual interest, it is more efficient that the parents themselves
determine the expenditure on their children. If the parents live separately, as
either single or remarried, the non-custodian parent loses control of child expenditures. Lack of contact further reduces the incentive or ability to contribute
time and money to the children. Together, these factors reduce the welfare of
both parents and children when they live apart (Weiss and Willis, 1985).
 Family decision making
The existence of potential gains from marriage is not sufficient to motivate marriage and to sustain it. Prospective mates are concerned whether the potential
gains will be realized and how they are divided. Family members have potentially conflicting interests and a basic question is how families reach decisions.
The old notion that families maximize a common objective appears to be too
narrow. Instead of this unitary model, it is now more common to consider collective models in which partners with different preferences reach some binding
agreement that specifies an efficient allocation of resources and a stable sharing
rule. (Browning et al., 2005, ch. 4).
In a special case, referred to as transferable utility, it is possible to separate the issues of efficiency and distribution. This situation arises if there is a
commodity (say money) that, upon changing hands, shifts utilities between the
partners at a fixed rate of exchange. In this case, the family decision process
can be broken into two  steps:  actions are first chosen to maximize a weighted
sum of the individual utilities, then money is transferred to divide the resulting
marital output. In general, the problems of efficiency and distribution are intertwined. We may still describe the family as maximizing a weighted sum of the
individual utilities, but the weights depend on the individual bargaining powers,
and any shift in the weights will affect the family choice. The bargaining power
may depend on individual attributes such as earning capacity, subjective factors
such as impatience and risk aversion, and on market conditions, such as the sex
ratio and availability of alternative mates (Lundberg and Pollak, 1993).
The question remains; what enforces the coordination between family members? One possibility is that the partners sign a formal "marriage contract" that
is enforced by law. However, such contracts are quite rare in modern societies,
which can be probably ascribed to a larger reliance, relative to the past, on emotional commitments and the presumption that too much contracting can ”kill
love”. In the absence of legal enforcement, efficient contracts may be supported
by repeated interactions and the possibility to trade favors and punishments.
This possibility arises because marriage is a durable relationship, forged by the
long-term investment in children and the accumulation of marital specific capital, which is lost or diminished in value if separation occurs. However, repeated
game arguments cannot explain unconditional giving, such as taking care of
a spouse stricken by Alzheimer who would never be able to return the favor.
Emotional commitments and altruism play a central role in enforcing family
contracts (Becker, 1991, ch.8).

 Divorce and remarriage
Divorce is motivated by uncertainty and changing circumstances. Thus, individuals may enter a relationship and then break it if a better match is met. Or, changing economic and emotional circumstances may dissipate the gains from marriage. As time passes, new information on match quality and outside options is accumulated, and each partner decides whether to dissolve the partnership. In making this choice, partners consider the expected value of each alternative, where the value of remaining married includes the option of later divorce and the value of divorcing includes the option of later remarriage. Under divorce at will, divorce occurs endogenously whenever one partner has an alternative option that the current spouse cannot, or is unwilling, to match by a redistribution of the gains from marriage. Following divorce, the options for sharing and coordination of activities diminish. The divorced partners may have different economic prospects, especially if children are present. Asymmetries arise because the mother usually loses earning capacity as a result of having a child. To mitigate these risks, the partners have a mutual interest in signing binding contracts that stipulate post divorce transfers. Such contracts are negotiated ”in the shadow of the law” and are legally binding. Child support payments are mandatory but the non custodial father may augment the transfer to influence child expenditures by the custodial mother. Payments made to the custodial mother are usually fungible and, therefore, the amount that actually reaches the children depends on the mother’s marital status. If she remarries, child expenditures depend on the new husband’s net income, including his child support commitments to his ex-wife. Hence, the willingness of each parent to provide child support depends on commitments of others. These interdependencies can yield multiple equilibria, with and without children and correspondingly low and high divorce rates (Browning et al., 2005, ch. 11).

http://en.wikipedia.org/wiki/Marriage
Even though this site is not always known for being the most credible source it gets to the meaning of what marriage is. This explains what marriage is, how it is in different cultures, and how it relates to money and power.

http://www.nlm.nih.gov/medlineplus/divorce.html
I chose this site to explain what divorce is because I found it extremely interesting that a site about health information is listing the meaning of divorce. Clearly divorce is more than just two people splitting up; it has emotional, physical, and health effects too.

William Shakespeare (1564-1616)

Let me not to the marriage of true minds
Admit impediments. Love is not love
Which alters when it alteration finds.
Or bends with the remover to remove:
O, no! it is an ever-fixed mark,
That looks on tempests and is not shaken:
It is the star to every wandering bark,
Whose worth's unknown, although his height be taken.
Loves's not time's fool, though rosy lips and cheeks
Within his bending sickle's compass come;
Love alters not with his brief hours and weeks,
But bears it out even to the edge of doom,
If this be error, and upon me proved,
I never writ, nor no man ever loved.

I chose this chapter because I find many of the topics discussed in this chapter interesting. I chose to go more into detail with marriage and divorce for two reasons. I talked about marriage because I am currently engaged and that is something that plays a huge role in my life and will continue to do so. I talked about divorce because divorce has had a direct impact on me due to my parents. I was raised in a religious home, so seeing some sociological theories on religion and in the family was pretty interesting. 

Chapter 13

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ACROSS 3   Symbolic activities that express a group's spiritual convictions. 4   A primary group of people--usually related by ancestry, marriage, or adoption. 5   Pattern of relationships that define people's relationships to one another within a family. 7   Practice of men or women having multiple marriage partners.

DOWN 1   The intensity and consistency of practice of a person's faith. 2   Formal organizations that tend to see themselves, and are seen by society, as the primary and legitimate religious institutions. 6   Groups that have broken off from an established church.