DP1715 'I Vont To Be Alone' Transitions to Independent Living, Marriage and Divorce Among Young Americans

Author(s): Arnstein Aassve, Simon Burgess, Carol Propper
Publication Date: October 1997
Keyword(s): Divorce, Household Formation, Marriage
JEL(s): J12
Programme Areas: Human Resources
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=1715

We investigate the importance of economic factors in young Americans? decisions to form and dissolve households. We adopt a search theoretic framework to analyse the decisions to: leave the parental home; form a marriage or partnership; and dissolve a marriage or partnership. We focus, in particular, on the impact of economic factors. Using a 14-year panel dataset of young Americans (the NLSY), we find an important role for income in all these transitions. High income in the individual?s present state reduces the chance of changing state, while high expected income in the destination state makes a move more likely.