Career Women and the Durability of Marriage∗

We study the relationship between divorce rates and female labor force attachment in the US. Recent cross-sectional evidence from US states displays a robust negative correlation between divorce and the rate of married female labor force participation. We suggest that this pattern can be explained at least partly by increased bargaining flexibility within two-earner as against one-earner households. Two-earner households can use cash rather than less efficient in-kind or promised transfers to re-adjust intrahousehold allocations when compensating for preference shocks or changes in outside opportunities, rendering their marriages more durable. Using retrospective and longitudinal data, we show that all else equal, there is a lower propensity to divorce among families in which the wife is a “career woman,” i.e. has a higher labor force attachment, though these families seem to display no lower incidence of marital difficulties. We discuss policy implications of our findings.