Public Transfers and Marital Dissolution

In this paper, we analyze determinants of marital dissolution, focusing on the alleged influences from public transfers, child allowance, and child support awards. We use a Norwegian panel of 2,806 couples with information on public and private transfers in cases of divorce. The sample was observed over a 5-year period, with the purpose of registering marital dissolution. We find that the level of transfers has a significantly positive effect on divorce probability and that the distribution of transfers in favor of the wife increases this probability. Our findings are consistent with noncooperative family models allowing for inefficient outcomes.