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Divorce Property Division Laws and the Decision to Marry or Cohabit

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  • Hayley Fisher

Abstract

This article presents a model of the choice between marriage and cohabitation that is used to analyze the implications of changing from a title-based division of property on divorce to an equal sharing regime. There are two opposing effects. In line with popular expectations, the change to equal sharing discourages some wealthy individuals from marrying since they risk losing half of their assets in the event of divorce. Offsetting this, equal sharing property division induces efficient investment in marriage, increasing the value of marriage relative to cohabitation for some couples. Overall, the impact on the number of marriages relative to cohabitations is ambiguous, although there will be more marriages where it is more difficult to invest, and where couples are more similar to each other. The Author 2011. Published by Oxford University Press on behalf of Yale University. All rights reserved. For Permissions, please email: journals.permissions@oup.com, Oxford University Press.

Suggested Citation

  • Hayley Fisher, 2012. "Divorce Property Division Laws and the Decision to Marry or Cohabit," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 28(4), pages 734-753, October.
    • Handle: RePEc:oup:jleorg:v:28:y:2012:i:4:p:734-753
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    File URL: http://hdl.handle.net/10.1093/jleo/ewr002
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    Cited by:

    1. Chigavazira, Abraham & Fisher, Hayley & Robinson, Tim & Zhu, Anna, 2019. "The Consequences of Extending Equitable Property Division Divorce Laws to Cohabitants," IZA Discussion Papers 12102, Institute of Labor Economics (IZA).
    2. Hayley Fisher & Hamish Low, 2015. "Financial implications of relationship breakdown: Does marriage matter?," Review of Economics of the Household, Springer, vol. 13(4), pages 735-769, December.
    3. Fabio Blasutto & Egor Kozlov, 2020. "(Changing) Marriage and Cohabitation Patterns in the US: do Divorce Laws Matter?," 2020 Papers pbl245, Job Market Papers.
    4. Frémeaux, Nicolas & Leturcq, Marion, 2018. "Prenuptial agreements and matrimonial property regimes in France, 1855–2010," Explorations in Economic History, Elsevier, vol. 68(C), pages 132-142.

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