Bryan Caplan  

Nudging Marriage

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If you think that Nudge doesn't matter, take a look at marriage. Only 5-10% of marriages have prenups; everyone else goes with the "default option" - the family law of the state in which they reside.

Why do people go with state law? You could say, "State laws are so wisely crafted that no one would want anything else," but that's laughable. The real reasons, as Heather Mahar explains, are (a) people underestimate their probability of divorce, so they barely plan for a likely event, and (b) asking for anything other than the default option is a bad signal:

[A]lthough respondents to her survey correctly identified the national divorce rate at approximately 50 percent, they believed their own chance of divorcing was just 11.7 percent. The more optimistic a respondent was about the enduring success of his or her marriage, the less likely he or she was to consider requesting a prenuptial agreement. "Just like everyone thinks they're a better-than-average driver, everyone thinks that there's no way their marriage will end in divorce," says Mahar.

Fear of what she calls "signaling" was also prominent: 62 percent of those surveyed thought that requesting a prenuptial agreement sends a negative signal about the future of the marriage.

One solution to the family law mess is simply to improve the default rules. The problem, though, is that there is bitter disagreement about how the default rules should be changed. Many, like Ann Crittenden in The Price of Motherhood, frankly admit that their main goal is "a massive shift of income to women," but men's rights advocates want something rather different. A totally different - and far less conflictual - approach is for state governments to get out of the business of writing default rules for marriage.

When the state provides a default, a request for negotiation is a bad signal. But if there's no default rule, the stigma of asking for a prenup goes away; a marriage proposal is a request to write a prenup. So why not replace the mess we have with simple contract law? Custody, property division, alimony, child support - wouldn't you rather work these out in advance than trust your state legislators and judges to figure out what's best for your family?

Even if you don't want to get the state entirely out of marriage, there's still no reason why a state marriage license shouldn't have a simple list of checkboxes spelling out the terms of dissolution. Alternately, in the true spirit of Nudge, states could re-label prenups as "the default option," and require people to affirmatively request to have their marriage governed by state law.

Question for you: If everyone had a prenup, what would the terms of the typical contract look like?


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COMMENTS (19 to date)
KipEsquire writes:

Sorry, but there's nothing "laughable" about the notion that the marital laws in most states get most couples most of where they want to be should they divorce: each spouse keeps pre-existing assets and gifts, with assets accumulated during the marriage divided either 50-50 ("community property states") or subject to equitable distribution ("common law states").

Antenuptials are of little benefit for poor couples or two-income middle-class households.

(And antenuptials cannot stipulate child support arrangements ex ante -- that is solely the discretion of the court based on the best interests of the child.)

And care to guess how much a custom-tailored antenuptial costs? Would you spend $300 on a will if you only had $400 in assets to bequeath? Etc.

The simple truth is that most people who divorce wouldn't need an antenuptial even under the most exotic post-marital fact patterns.

You remind me of the stock analyst whose recommendation bombs and then insists, "I'm not wrong, the market is!"

H man writes:

For starters, alimony would be used to reintegrate the stay at home parent into the workforce. Not an open ended commitment from one person to another.

Nathan Whitehead writes:

When my wife and I got married we listed our assets, worked through some scenarios, and then decided not to get a prenup. We concluded the only need was deciding what to do with kids after a divorce, so we agreed to craft an agreement before we have kids.

Stan Greer writes:

The "50% of U.S. marriages end in divorce" claim is a canard.

The real figure is very hard to obtain, for a variety of reasons, but it seems to be somewhat under 40%. See:
http://familylaw.typepad.com/stats/divorce_rates_us/index.html

And if you and your prospective spouse are both college-educated and neither of you has been married before, your odds of divorce are far lower than the U.S. average -- probably under 20%.

In such cases, I'm guessing that couples that get pre-nups are far more likely than those that don't to get divorced in the end.

Of course, correlation doesn't equal causality, but engaged couples who avoid pre nups because they think they might poison the marriage aren't being irrational at all, based on the available evidence.

Steven writes:

In such cases, I'm guessing that couples that get pre-nups are far more likely than those that don't to get divorced in the end.

That's Prof. Caplan's point--people are afraid to get pre-nups, fearing that they would signal their presence in the more-likely-to-divorce group. So you'd be correct to say that these individuals are not acting "irrationally," but that doesn't necessarily imply that the current default rules are optimal.

larry writes:

Kip Esquire,

You may be correct that for most couples, in most states, divorce law provides the same result the couples would have chosen before the marriage. But at least in some states and with quite a few couples, the state's divorce law leads to results few men would affirmatively agree to.

For example, I suspect few men would agree to paying years of alimony. In quite a few states alimony is common. In at least several states even long-term alimony for a fairly short-term marriage is common.

Similarly, few men would agree to pay thousands of dollars for their wives to hire a high-priced attorney to extract the most money possible from them.

Why do you find it objectionable to allow these people a meaningful choice of the financial/legal consequences of the breakup of their marriages?

Of course, couples can sign prenups now. But, as the post pointed out, most people are very reluctant to bring up the subject of prenups because doing so might antagonize their soon-to-be spouse.

8 writes:

In Massachusetts, if a divorced man remarries and becomes unemployed, his spouse is responsible for paying his ex-wife's alimony. Would that even be legal to include in a pre-nup?

Bob Knaus writes:

If no state laws existed, if every marriage required a specific contract to be signed, then the great majority of marriages in the US would use a template provided by a religious organization. It would be part of the "church wedding" package.

Even those not opting for a religious ceremony would find that a number of religious organizations would advertise "free" wedding contract templates. For the organizations, this would simply be part of their evangelical outreach program.

Doubtless some non-religious organizations would provide contract templates as well. But their sucess might be limited by signalling effects. I can think of a few guys who would be strongly attracted to a woman who said "If you want to marry me, honey, we will sign this contract provided by NOW." I think the majority would head for the exits.

I cannot resist quoting Hobbes: "If you're friends are contractual, then you don't have any.". Yes, there are practical reasons for marriage contracts. But far too many people view a legal contract as a way to cement a personal relationship ("tie the knot"). Would you really want to be that marginal relationship that's only being held together by a legal contract?

Lord writes:

Most marriages are among the young with little or no assets therefore prenups are largely irrelevant.

Phil writes:

One big problem with state law is that it can change without notice and changes are retroactive. At least couples should be bound by what the law was as of the date of the marriage. A contract where a third party can change the terms at will isn't really a contract at all.

aaron writes:

I vote for getting the state out of marriage altogher.

Steve Sailer writes:

People would respond by not getting married. It's hard to think through alternative scenarios and it leads to emotional conflicts. People would just shack up.

Kurbla writes:

"Question for you: If everyone had a prenup, what would the terms of the typical contract look like?"

In practice, weak, poor side would be in much worse situation, and many contracts would be close to slavery. E.g. rich man marry poor girl, in the case of divorce, she has to pay him alimony of $10000 monthly whole life.

Tracy W writes:

Custody, property division, alimony, child support - wouldn't you rather work these out in advance than trust your state legislators and judges to figure out what's best for your family?

Would my results be any better than their's?

Elizabeth Taylor may well be experienced enough at divorce to write a good pre-nup. But most people don't get married all that often over a lifetime, so there's not that many options for learning-by-doing. Also, it's writing a contract for a remote unpredictable future - everyone I know who has kids says they didn't know ahead of time how their lives would change. My female friends who have had kids generally have totally changed their views about keeping a job after the baby was born - whatever their view was before. My mother, during my school years, changed her mind totally about public vs private schools. People acquire different amounts of property. People have accidents that change their earning ability. How are the people working out pre-nups meant to predict that ahead of time?

And the contract will inevitably be incomplete, which means the state will be called in to include other factors.

Finally, this is a contract you would be negotiating with someone you love, but you would have to be imaginging yourself in an adverse situation. Difficult problem.

I am fully aware of all the difficulties with government decisions. But I doubt that private decision-making is any better. There are plenty of cases of people going to court trying to overturn pre-nups. And those pre-nups are being written by the people most motivated to write them.

Willem writes:

@Kurbla
Don't you think there is some countervailing power (maybe even called 'love')? The women I know seem pretty able to choose their own partner.

Thomas Boyle writes:

Kurbla,

In the US, family law already bears a remarkable resemblance to slavery - for the breadwinner. It includes an assessment of the breadwinner's ability to earn (not actual earnings) and a demand for payment on that basis. The breadwinner essentially becomes property - chattel - of the supported spouse. As a result, family law creates massive incentives to race to the bottom, and disincentives to contributing to the financial advancement of the family, since being divorced is bad enough for most people, without also finding themselves thrown into bondage for having committed the sin of earning more. Family law is perverse, to say the least, in its treatment of breadwinners (although generally only when the breadwinner is male). The fact that so many "rich, powerful" people submit to this type of treatment is a remarkable testimony to the extent of breadwinners' love for their spouses. What it says about their spouses, I don't know.

Part of the reason people who get married don't have a problem with this, is selection; those of us who have a problem with being treated like this, aren't married.

Katharine Young writes:

Mr. Boyle,

Just want to assure you that we have reached the level of gender equity as far as divorce is concerned. I was divorced at 2002 and was the bread winner. I was forced to pay my ex-husband the present value of my pension yet to be collected at the time of divorce. The court calculated the total pension worth based on my future life span( estimated to be 35 years). I was forced to take out loan to pay this judgment in cash as he refused to wait till it is time for me to collect as i could not retire yet (he was afraid i might die before i retire and hence he would be unable to collect any). I was told by my attorney that i was lucky i did not work for private company that grants stock options. He saw many of his clients have to pay cash for the value of the stock options that they can not exercise at the time of divorce;and have no way of knowing how much those would be worth when eventually sold.
I agree with you, it is the responsible one in the marriage who gets enslaved, whether male or female. However,it is better to take charge of one's own destination than depending on the state laws. As we all know that laws might be legal, but in many occasion, neither ethical nor equitable. It is still the best we have compared to other countries.
i hope that some divorce attorney will soon write a "prenup for dummies" book with sample forms and list all those "got-you"s. I will definitely ask the book to be included in the "must read" list for all our high school seniors.

Katharine Young

Thomas Boyle writes:

Ms. Young,

I am sorry indeed to hear of your experience. I apologize if my (over)generalization upset you, as I realize it may have. You are not the first woman to have made this point to me, and I should have acknowledged that. Another woman told me she felt that she was being treated worse than a white-collar criminal, with a 15-year sentence for the crime of having loved someone.

You should not have been treated as a piece of income-generating property. No-one should. An institution that treats people that way is unconscionable, not something for young people to aspire to.

All you can do now is pass the word along. Good luck to you.

P.S. Be careful about prenups. They may not be enforceable - but the marriage will be (you cannot make the validity of the marriage conditional on the validity of the prenup). Many states have a history of either refusing to enforce them at all, or place severe limitations on them, or have onerous and/or vague rules for them. If you are in - or later move to - one of these states, your marriage will be valid; your prenup may not.

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