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Claremont Colleges Working Papers in Economics, Department of Economics, Claremont McKenna College >
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http://hdl.handle.net/10419/31429
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| Title: | | For better or for worse? State-level marital formation and risk sharing  |
| Authors: | | Chami, Ralph Hess, Gregory D. |
| Editors: | | Claremont Institute for Economic Policy Studies |
| Issue Date: | | 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 |
| Appears in Collections: | | Claremont Colleges Working Papers in Economics, Department of Economics, Claremont McKenna College
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