Scandinavian Working Papers in Economics

Umeå Economic Studies,
Umeå University, Department of Economics

No 707: The Role of Unemployment in the Commitment Dissolution Decision among Young Swedes

Magdalena Norberg-Schönfeldt ()
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Magdalena Norberg-Schönfeldt: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

Abstract: This paper studies the role of unemployment in the dissolution of relationships by applying a two-step estimation method to an extensive data set, which contains information about young Swedish males and females. Unemployment is recognized as endogenous in the separation decision, and the results show that the effect of unemployment on separation is biased when unemployment is assumed to be exogenous in the separation equation. The probability of separation is found to be increasing with male unemployment, whereas female unemployment decreases the probability of dissolution.

Keywords: Unemployment; divorce; family structure

JEL-codes: J12

44 pages, June 7, 2007

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