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Less money after divorce – how the 2008 alimony reform in Germany affected spouses’ labor supply, leisure and marital stability

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  • Julia Bredtmann

    (RWI – Leibniz Institute for Economic Research)

  • Christina Vonnahme

    (RWI – Leibniz Institute for Economic Research)

Abstract

The 2008 alimony reform in Germany considerably reduced post-marital and caregiver alimony. We analyze how individuals adapted to these changed rulings in terms of labor supply, the intra-household allocation of leisure, and marital stability. We use the German Socio-Economic Panel (SOEP) and conduct a difference-in-difference analysis to investigate couples’ behavioral responses to the reform. In general, the results do not confirm theoretical expectations from labor supply and household bargaining models. In particular, we do not find evidence that women increase their labor supply as a result of the negative expected income effect. Neither do our results reveal that leisure is shifted from women to men as a response to the changed bargaining positions. We find some evidence that married couples are more likely to separate after the reform, but this effect vanishes once unobserved heterogeneity at the couple level is controlled for.

Suggested Citation

  • Julia Bredtmann & Christina Vonnahme, 2019. "Less money after divorce – how the 2008 alimony reform in Germany affected spouses’ labor supply, leisure and marital stability," Review of Economics of the Household, Springer, vol. 17(4), pages 1191-1223, December.
    • Handle: RePEc:kap:reveho:v:17:y:2019:i:4:d:10.1007_s11150-019-09448-z
    DOI: 10.1007/s11150-019-09448-z
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    Cited by:

    1. García-Morán, Eva & Kuehn, Zoe, 2023. "Till mess do us part: Married women's market hours, home production, and divorce," MPRA Paper 119324, University Library of Munich, Germany.
    2. Dorian Kessler, 2020. "Economic Gender Equality and the Decline of Alimony in Switzerland," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 17(3), pages 493-518, September.
    3. Marianna Schaubert, 2023. "Do Alimony Regulations Matter Inside Marriage? Evidence from the 2008 Reform of the German Maintenance Law," Journal of Labor Research, Springer, vol. 44(1), pages 145-178, June.

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