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Combining Behavioral Endocrinology and Experimental Economics: Testosterone and Social Decision Making

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Booms, Busts, and Divorce.

Judith K Hellerstein¹, Melinda Sandler Morrill²

¹University of Maryland, Department of Economics and MPRC, and NBER.

The B.E. Journal of Economic Analysis & Policy

|September 16, 2014

Summary

This summary is machine-generated.

Divorce rates decrease during economic downturns, with higher unemployment linked to fewer divorces. This study confirms the pro-cyclical nature of divorce, showing a significant negative relationship between unemployment and divorce rates.

Keywords:

business cycles divorce unemployment rate

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Area of Science:

Sociology
Economics
Demography

Background:

Anecdotal evidence suggests divorce rates fall during economic recessions, but empirical data has been limited.
Theoretical predictions on the impact of macroeconomic conditions on divorce are ambiguous.
Previous research focused on individual job loss, with less attention to broader economic shocks.

Purpose of the Study:

To empirically investigate the relationship between macroeconomic conditions and divorce rates in the United States.
To quantify the impact of state-level unemployment rates on state-level divorce rates.

Main Methods:

Utilized vital statistics data on divorces in the U.S. from 1976-2009.
Conducted an empirical analysis correlating state-level unemployment rates with state-level divorce rates.
Employed robust statistical methods, including alternative specifications and data expansions.

Main Results:

A significant and robust negative relationship was found between unemployment and divorce rates.
A one percentage point increase in the unemployment rate was associated with a decrease of approximately 0.043 divorces per 1,000 people.
This represents about a one percent fall in the divorce rate for every one percent rise in unemployment.

Conclusions:

Divorce is a pro-cyclical phenomenon, declining during periods of higher unemployment.
Macroeconomic conditions, specifically unemployment, have a measurable impact on marital dissolution rates.
Findings are consistent across various empirical specifications and demographic subgroups.