The Economic Effects of Divorce
Marriage is identified as the “legal union between a man and a woman as husband and wife” (Marriage, 2008, n.p.). Likewise, it denotes an action which involves a contract, ceremony, or a formality where a conjugal union is developed or when the union itself has then become an enduring condition for the involving parties. Marriage is considered as the gateway for the establishment of family, which is noted to be the fundamental unit of every society. Although marriage and family are different terms, both are intertwined with each other. Hence, both perspectives can be viewed as the central institution of social life. However, with the onset of gradual modernization, marriage and family have become an area for contestation instead of being a consensus. As new changes take place, marriage and family, which were once considered as strong institutions, have faced radical structural transformations.
The past several decades have been a witness to the growing skepticism of people towards divorce. In America alone, the public has been examining divorce in different perspectives, putting the blame on their current “tension-laden, urban, industrial society” for the spread of divorce (Riley, 1997, p. 3). Historically speaking, however, the presence of contemporary American divorce is not just a recent phenomenon of a troubled society. In fact, the first records of such activity were first brought by the Puritan settlers in their American colonies during the early part of 1600’s. Surviving courts have accurately documented that myriads of colonial Americans sought divorce in order to end their marriages where they have experienced dissatisfaction or disillusionment. There were even strong references that untold numbers of colonist deserted their partners. Thus, for 350 years, divorce is continuously growing and developing in the American society and other parts of the globe.
Today, divorce has become a customary or traditional means of resolving marital incompatibilities. As divorce is becoming widely recognized, the perception of people towards marriage was significantly altered. Many people are now claiming that marriage is just a contract and that parties under that particular contract have the right to dissolve it through divorce (Riley, 1997). Alongside the acknowledgement of divorce as a major solution for marital incompatibility, social scientists tracked the impact of such phenomenon in family life. There have been numerous reports regarding the emotional effects of divorce among children, women, and men. However, little has been written about the economic effects of divorce, not thoroughly examining the extent of the problem and limiting the knowledge of people regarding such matter.
Back in the era when traditional divorce law was still practiced, the economic perspectives of divorce were based upon the determination of spousal fault. This means that the financial consequences of divorce is decided if one of the spouse is found guilty of such fault and the other is innocent from a certain marital offense. In this manner, financial aspects like alimony can be awarded to the innocent spouse, whereby courts awarded the right amount of alimony to the innocent party, and the custody could be denied if, for instance, the woman is found to be guilty of faults like adultery (Weitzman & Dixon, 1983 cited in Everett, 1992).
Several years later, between 1969 and 1985, all of the states in America embraced some aspects of “no-fault divorce” which was preceded by the state of California. Hence, this period in America was considered as the Divorce revolution. The legislation forwarded by Californians proposed that “ground for divorce should be predicated solely and exclusively upon the ground of irremediable breakdown” (Rheinstein, 1972, p. 384; Weitzman, 1981 cited in Everett, 1992, p. 5). With the said legislation, traditional divorce grounds such as desertion, adultery, and cruelty were then aligned with no-fault divorce grounds like incompatibility or irreconcilable marriage (Parkman, 2000). The said reform paved way for the initiation of divorce processes without substantial proof of wrong doings. Likewise, no-fault divorce removed fault as a basis for property settlements, alimony, or the division of assets (Mechoulan, 2005). Not only did no-fault divorce changed the outlook regarding traditional fault grounds making divorce difficult to be obtained; the legislation made divorce commonly available for spouses in a unilateral manner. While the fault divorce system provided protection to both parties in terms of economic aspects, the no-fault system eliminated the negotiating power of the spouse who does not want to dissolve the marriage. Hence, this greatly affects the incentive of spouses to have a commitment on their ended marriage which is accompanied by sacrifices that are beneficial for the family. In this sense, individuals now focus on their self interests and invest less on the interest of the family that will be left behind (Parkman, 2000).
During the 1980’s, several researchers explored the effects of divorce in terms of economic perspectives. Three striking findings were found, and these findings are continuously acknowledged to date. First, it was concluded that many divorced mothers who have the custody of their children are living in poverty. Second, such slide into poverty is the effect, and not the cause of divorce. Lastly, it was indicated that divorced fathers, if taken as a group, are more likely to make considerable gains with their way of living compared to their former wives (Nicholas-Casebolt, 1986; Weitzman, 1981; Teachman & Paasch, 1994; Arendell, 1986; all cited in Hoge, 2002). For the foregoing, many studies have suggested that the economic consequences of the reform are detrimental to women and children. This is in great contrast to their male counterparts, who have shown in various studies that the percentage of men in living in poverty decreases after the divorce (Nichols-Casebolt, 1986 cited in Hoge, 2002). In contrast to this, it was found that there is a significant decrease in the over-all facet of women’s settlements which include alimony, property settlement, and child support after the reform in the divorce system (Hoge, 2002).
Under the traditional rules, the innocent spouse can be awarded lifetime alimony. However, under no-faults divorce, the awarding of alimony is based in two factors: employability and duration of marriage. In this manner, women who were homemakers during the process of marriage are likely to be placed in a disadvantaged position. This is due in part of the fact that these women will have trouble securing jobs and were more likely to have the children in the household compared to other divorced women. Likewise, it was noted that the right to alimony of women who were in short-term marriages is virtually removed. Hence, they receive no support at all which serve as a catalyst for them to undergo severe economic problems (Boumil, Hicks, & Friedman, 1992).
In addition, it was discovered that many divorced women serve as custodial parents right after the divorce while raising their children with inadequate financial support from the ex-spouse (Boumil, Hicks and Friedman, 1992). This is an indication that female-headed households responsible for supervising the children are at a great risk of experiencing poverty. It was reported that a year after the divorce, the woman’s standard of living falls from 35% to 30% (Cherlin, 1992 cited in Rank, 2004). The sharp decline is accounted to the failure of mothers to receive the due court ordered child support. Likewise, divorce has also back fired in property settlements. Most custodial mothers were found to have been unable to purchase homes based from the compensations they received from property settlements. Instead, they are forced to settle or relocate in small homes or apartments with their children that could be found in neighborhoods that are less affluent (Everett, 1992). Hence, this body of work suggests that when divorce occurs, women as well as their children suffer severe economic poverty.
Based on the data drawn from the study, divorce has far-reaching economic effects. Divorce was once seen as a solution for irreconcilable differences of spouses in marriage. It was once deemed as a personal choice and an avenue in order to improve lives. However, with its reform come the negative consequences that are inevitable. Divorce combined with the wrong societal misconceptions and wrong judicial applications place women and children in a disadvantaged position. It has been well noted that more and more divorced women and children of divorced couples are suffering from poverty. Likewise, divorce also has negative implications for men, although they are less obvious. Rather than eliminating the so-called economic bias in gender, divorce served as catalyst for the rise of lowered economic stature of women, further placing men in a more comfortable position.
In this sense, there should be proper reforms in the settlements that would protect each party. Likewise, the pervasive effects of divorce should be properly addressed, regardless if it is no-fault ground or fault-ground. It is only in this manner that proper information and tools can be attained in order to avoid such phenomena and maintain intact marriages.
Boumil, M., Hicks, S.C., & Friedman, J. (1992). Women and the Law. Buffalo, NY: Wm. S.
Everett, C. A. (1992). The Consequences of Divorce: Economic and Custodial Impact on Children and Adults. Binghamton, NY: Haworth Press.
Hoge, H. (2002). Women’s Stories of Divorce at Childbirth: When the Baby Rocks the Cradle. Binghamton, NY: Haworth Press.
Mechoulan, S. (2005). Economic Theory’s Stance on No-fault Divorce. Ontario, Canada: University of Toronto.
Marriage. (2008). The Free Dictionary. Retrieved December 5, 2008 from http://www.thefreedictionary.com/marriage.
Parkman, A. M. (2000). Good Intentions Gone Awry: No-fault Divorce and the American Family. Lanham, MD: Rowman and Littlefield.
Rank, M. R. (2004). One Nation, Underprivileged: Why American Poverty Affects Us All. New York: Oxford University Press US.
Riley, G. (1997). Divorce: An American Tradition. Lincoln, Nebraska: U of Nebraska Press.