Essays on Family and Labor Economics

Stefania Marcassa

Research output: ThesisDoctoral Thesis

Abstract

This thesis focuses on two areas of studies in the field of family economics: marital status, and fertility decisions. First, I propose a quantitative model to evaluate the effect of a change in divorce law that took place at the end of the Sixties in the U.S. Second, I provide an empirical analysis of the geographic and temporal decline ofthe fertility rate in the U.S. from the end of 1800 and the beginning of 1900. In the part 2, I analyze the impact of the change in divorce law on the divorce rate in the early Seventies. At the end of the 1960s, the U.S. divorce laws underwent major changes and the divorce rate more than doubled in all of the states. The new laws introduced unilateral divorce in most of the states, and changes in property division, alimony and child support transfers, and child custody assignments in every state. Empirical literature has focused on the switch from consensual tounilateral divorce and found that this change cannot fully account for the increase in the divorce rate. What previous literature has ignored is other aspects of the legal change, and their effect on divorce rate in states where the decision remained consensual. I show that changes in divorce settlements provide economic incentives for both spouses to agree on divorcing. I solve and calibrate a model where agents differ by gender, and wages, and make marital status, investment, and labor supply decisions. Under the new financial settlements, divorced men gain from a favorable division of property, while women gain from an increase in the expected value of transfers from the ex spouse. Since both of them are better off in the new divorcesetting, the requirement of consent for divorce is no longer necessary. Results show that changes in divorce settlements account for a substantial amount of the increasein the divorce rate. I also show the implications of the model in terms of time allocations. In part 31, we empirically investigate the transition process of the fertility rate in the U.S., and estimate the effect of diffusion on geographic and temporal variations in fertility. First, we provide measures of local and global spatial correlation to establish the existence of a significant geographic pattern in the data. Moreover, we use a spatial-diffusion model to assess the effect of diffusion in shaping fertility variation across about 400 state economic areas from 1870 to 1930. The variation infertility levels and the fertility potential for each state economic area are measured. Fertility potential is a spatial-effects variable that summarizes each state economicarea?s geographic proximity to the influence of other high or low fertility areas. The findings support a diffusionist model of fertility. Even when controlling for demographics and economic variables, fertility levels remain sensitive to fertility level of other SEAs?, especially proximate ones. This is consistent with the operation of diffusion process like those described by Watkins and Coale (1986) and Tolnay(1995). That is, spatial similarity in fertility can result from the spread of fertility related knowledge, or from the diffusion of changing norms related to family size within marriage.
Original languageEnglish (US)
Place of PublicationMinneapolis, MN
StatePublished - 2009
Externally publishedYes

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