Legal structures of divorce settlements are important in how marital division of labour impacts on divorce. They affect not only divorce welfare but also Coasean within-marriage allocations. We offer a new theoretical framework to empirically identify Coasean and non-Coasean behaviour. Whilst an increase in the spouse’s wage always reduces (increases) non-Coasean labour supply (home production), observing an increase in both types of production indicates Coasean bargaining. Observing labour supply falls after a divorce will again indicate Coasean bargaining. We give a possible explanation for why males’ preferences for stereotypical work division and the females emphasise on non-monetary work aspects persist.
|Name||Discussion Paper in Economics|
|Publisher||University of Aberdeen|
- Coasean Bargains
- Non-Coasean behaviour