Even though divorce rates are declining over all, as far back as 1977 the economist Gary Becker showed that couples experiencing any unexpected, drastic rise in net worth are at risk of divorce. (The same holds true for a drastic decline in net worth.)
Here is the article, which focuses on real estate. The pointer is from Daniel Akst.















Or, perhaps, they enjoy the opportunity to divorce.
That is sad. Time to dust off the old foot-binders.
The famous musical advice:
You’d better keep her,
You’ll find it’s cheaper,
Than makin whoopee
can be more readily ignored by the wealthy.
Ex-husband: Do you know why is divorce so expensive?
Economist: Because the consumer surplus is largely captured by lawyers and ex-spouses, resulting in high fixed and recurring transaction costs?
Ex-husband: Oh yeah, that too. I was going to say “because it’s worth it”.
I agree that the “negative” finding can actually be quite a liberating one. However, I have a suspicion that people see it as negative because they don’t like having the fact that a lot of marriages persist for logistical reasons be as salient as this finding makes it.
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