Women work less and do more childcare when divorce would mean that the family”s assets are split equally. That is the central finding of research by Daniela Piazzalunga, to be presented at the Royal Economic Society”s annual conference in Brighton in March 2016.
In most European countries, divorces mean that the family”s assets that have been built up during the marriage are split 50/50 between the husband and wife, regardless of who acquired it. This is seen as a way to recognise the work women put into domestic work, for which they may have had to sacrifice their work life. In England and Wales, however, judges have more power to choose how to split this up, and until the end of the 1990s would generally favour men.
In 2000, the White v. White case changed this by introducing the ”yardstick of equality” and recognising the contribution of homemakers. The new study finds that English married women did on average 1.5-2.5 fewer hours of work per week, which may be because they now have more bargaining power, or because they know they can afford to work less.
Further investigation finds that women are not doing more housework, but are 5-10% more likely to be caring for their children. Importantly, this effect only happens among richer, more educated couples who can afford to work less in the first place. The author comments:
”Women working less and doing more childcare questions the need to split assets equally. On one hand, it can protect women who already work less to care for the home. On the other hand, it can reinforce the traditional division of labour, slightly pushing women out of the labour force.”
When the division of property at divorce is split more fairly between husband and wife – recognising her contribution through domestic and care work – married women reduce their employment, research shows, investigating the impacts of the landmark divorce case White v. White. On the other hand, they take care of children more than before. These are the central findings of a paper by Dr. Daniela Piazzalunga, to be presented at the Royal Economic Society Conference in March.
In most European countries, a divorce leads to an equal split of assets, which means that the wealth acquired during the marriage is subject to a 50/50 division between the husband and the wife if the marriage is dissolved, regardless of whom acquired it (community property).
This regime – opposed to the separation property – is usually considered as an implicit way to recognise the role of women in the formation of the household”s wealth, through the domestic and care work, which often come at the disadvantage of their labour supply.
England and Wales follow instead the ”equitable distribution regime”, which accords to the judge discretion in dividing couple”s wealth. Until the end of the 1990s, the rule of thumb was to consider ”reasonable requirements” to split assets when wealth exceeds the financial needs of the family, favouring men, whose income (and thus savings) usually exceeds the wife”s one. This approach has been largely modified with the White v. White case (October 2000), when the ”yardstick of equality” has been introduced, recognising the contribution of the homemaker.
Such decision affected not only the wellbeing of people after divorce, but also their behaviour during marriage. The economist Daniela Piazzalunga shows in her study that English married women reduced their labour supply by 1.5-2.5 hours per week on average, after the White v. White case – that is, when the division of property is more favourable to them.
These results confirm the theoretical model developed in 2002 by Professor Chiappori (Columbia University) and co-authors, and reinforce other empirical research with similar findings in Spain, Italy and the United States.
The channel may be twofold: on the one hand, the new division of property can increase the bargaining power of women, by virtually increasing their income; on the other hand, they know that in case of divorce they will be entitled to a larger share of assets than before, and thus they may afford to work and earn less, and use their time to perform housework chores, to take care of the children or simply for leisure.
Dr Piazzalunga investigates these additional impacts to understand what women are doing with the time they spare from work. Her findings suggest that women do not increase housework time, but they are 5-10% more likely to be mainly responsible for children. In addition, she shows that the effects arise only among high educated/high income couples, who are more likely to have additional wealth that exceeds the financial needs of the family and where the wife can afford to reduce her labour supply.
The reduction in women”s labour supply together with the increase in childcare questions the role of the equal split of family assets in protecting the financially weaker spouse. On the one hand, that can be a fair and protective tool ex post, for women who already reduced their labour supply to perform domestic and care chores. On the other hand, however, ex ante it reinforces the traditional division of labour, slightly pushing women out of the labour force.
Future research needs to investigate if, after a divorce, women are able to increase again the time they devote to work.
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