The Value of Remarriage: Welfare Effects of Divorce Legalization
نویسندگان
چکیده
Until 2004, divorce in Chile was illegal and separated individuals were unable to remarry. This paper examines who benefits or looses from the option of exiting a marriage and remarrying. Using longitudinal survey data, we first document the effects of the reform on couples formation and separation. We then use this variation in the data to structurally estimate and validate a dynamic equilibrium model of marriage and remarriage over the life cycle and estimate the welfare impacts of legal divorce across genders, schooling levels and ages. We then simulate the effects of mutual consent vs. unilateral divorce and of different separation time requirements on marital decisions and welfare. JEL Classification: J12 ∗Department of economics, Universitat Autònoma de Barcelona, Barcelona GSE and MOVE †Department of Economics, University of North Carolina at Chapel Hill (Corresponding author: [email protected]) We would like to acknowledge the comments and discussion from colleagues and seminar participants at UNC, UAB, the annual meeting of the Society of Economic Dynamics (Cyprus) and the University of Southampton. Sekyu Choi gratefully acknowledges financial support from the Spanish Ministry of Education through grant ECO2012-32392. All errors are our own.
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