Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/31429
Authors: 
Chami, Ralph
Hess, Gregory D.
Editors: 
Claremont Institute for Economic Policy Studies
Year of Publication: 
2002
Series/Report no.: 
Working paper series // Claremont Institute for Economic Policy Studies 2002-07
Abstract: 
Why do some U.S. states have higher levels of marital formation than others? This paper introduces an economic model wherein a state's representative individual may choose to marry in order to diversity his or her idiosyncratic income risk. The paper demonstrates that such a diversification motive is enhanced for some utility functions when a state's level of undiversifiable risk becomes larger, and when a state's initial income and growth rate is lower. A test of the model's predictious, using cross - sectional data for the 50 U.S. states, suggests that there is broad support for a risk sharing motive for marriage as well as for a precautionary attitude towards risk. - Consumption Insurance ; Marriage
JEL: 
J12
D1
E21
Document Type: 
Working Paper

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