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Covenant Marriages

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126.March 2010 Covenant Marriages: Increasing Commitment or Just Costs? Amanda J Felkey Department of Economics Lake Forest College 555 North Sheridan Road Lake Forest, IL 60045 E-mail: [email protected] Abstract To combat the growing divorce rates, Louisiana, Arkansas, Arizona and Oklahoma have begun to offer covenant marriage contracts, which are more costly to enter and exit than are traditional marriages. From a policy and public finance standpoint it is important to understand how the availability of this stricter form of marriage may fundamentally change the choices to marry and divorce. This paper explores the costs imposed by covenants and documents the effects of the covenant marriage option. It utilizes marriage and divorce rate data from Louisiana, Arkansas and Mississippi between 1990 and 2007. The paper’s goal is to understand how covenants change the relationship decision made by individuals and provide evidence as to whether or not this option is effective in its goal to create stronger, happier unions. It provides the first documentation of the effects of this interesting new phenomenon. JEL classification numbers: D10, K12, H70 Key words: Covenant Marriage, State Marriage Contracts, Divorce Rates21. Introduction The economic research devoted to understanding how marriage and divorce legislation affects family formation and dissolution is plentiful. Beginning with Becker’s Treatise on the Family (1981), economists have considered outcomes in marriage markets throughout the world, estimated the value of being married and have had extensive debate over how divorce legislation affects divorce rates (Allen 1992, Peters 1992, Gatland 1997, Friedberg 1998, Wolfers 2006). With an eye toward how policy affects individual wellbeing, economists continue to make strides in understanding how the social and legal environment in which couples find themselves shapes their decisions to enter and exit marriage. This paper adds to this literature by exploring the effects of a recent addition to divorce legislation and a new commitment device for marriage, the covenant marriage. The covenant option has been considered at least once and often repeatedly by nearly half the states in the U.S. It has passed one but not both houses in Oregon, Georgia and Texas and has been adopted as a legal option in four states, Louisiana, Arizona, Arkansas and, most recently, Oklahoma. Proponents of this type of marriage contend divorce rates will decline because individuals will find themselves in stronger, happier unions. This paper endeavors to speak to this prediction by analyzing whether or not covenant marriages are an effective commitment device (Felkey, forthcoming). The goal of this paper is to document and offer a comprehensive analysis of the effects of this commitment device on family formation and dissolution. It will consider the costs imposed by this option, both on those who opt for this type of marriage, as well as, those who do not (Drewianka 2004). It will explore how the option to covenant marry affects couple in other types of relationships—specifically those in and deciding to engage in traditional marriages. In order to determine whether the covenant option is effective in its goal of decreasing divorces, this paper empirically examines how divorce and marriage rates change, taking into consideration state, county and time fixed effects (Friedberg 1998), how long covenant marriages have been an option (Wolfers 2006) and the rate of their utilization; all three with and without location specific trends. The empirical analysis uses administrative data from three states, Louisiana and Arkansas, which have both had the covenant marriage option since 1997 and 2003, respectively, and Mississippi, a comparable state without the covenant option.3The remaining sections of this paper are laid out as follows: Section 2 will detail theory surrounding the decisions to marry and divorce and explore how the option to have a covenant marriage affects those decisions. Section 3 documents the empirical effects of this new type of union. And the last section remarks on the implications of this paper’s findings for state marriage and divorce policy. 2. Theoretical Effects of Covenant Marriages Covenant marriage affects not only the costs of getting divorced, but the property rights in the union, the bargaining power within the couple and even the decision to marry in the first place. This section explores theoretically the implications of this new legal option for marriage. It will first describe what a covenant marriage is and explain how it differs from a traditional one. Then it will discuss who is using covenants and why, because understanding why couples engage in this more costly process will help us better understand how it affects the decision to divorce. Finally, this section will discuss the costs associated with this option—it will not only focus on the costs to those who engage in this union, but will also consider the costs faced by those in other commitment-type relationships. 2.1 Covenants as a Commitment Device The covenant marriage is an option at the time the marriage license is issued in four states. Covenant marriages are a stricter legal contract than the traditional marriage, which is still offered in all fifty states. It is stricter in the sense that it is more costly to enter and exit. When opting for a covenant, couples agree to undergo pre-marital counseling, and once married they give up their right to a no-fault divorce (which has been the status quo on in all fifty states since the mid-1980’s), they must undergo marital counseling and be separated for a specified period before divorcing. The fault grounds that allow covenantly married couples to dissolve a marriage include: adultery, felony conviction, abandonment, abuse, two-year separation or passage of a specified period following a judgment of separation from bed and board. This marriage closely resembles the ones that every state offered prior to the no-fault divorces revolution that began in 1969. Previous research, aimed at understanding who engages in this more costly type marriage and why, finds that the covenant marriage option is likely used as a commitment device rather than a signaling/screening device in the marriage market (Felkey, forthcoming). Empirical evidence also indicates that on average younger yet more educated individuals


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