Academic journal article Indian Journal of Economics and Business

Altruism in Child Custody Decisions: Theory and Logistic Regression Evidence

Academic journal article Indian Journal of Economics and Business

Altruism in Child Custody Decisions: Theory and Logistic Regression Evidence

Article excerpt

Abstract

We use an Edgeworth box to study child custody decisions, using joint custody as an indicator of altruism. We extend the theory to examine the joint utility of the three parties (husband, wife, and child) with the help of Karni and Safra's (2002) fairness triangle. A binary logistic regression model estimates the probability of joint custody awards from Wisconsin panel data and develops an index of altruism. A second logistic regression estimates the probability of mother sole custody as explained by the index of altruism and other control variables. We determine that altruism is significantly important in child custody decisions.

Author Keywords: Marital Conflict; Choice Behavior.

JEL classification codes.: J12, D10.

Introduction

Before the liberalization of divorce laws in the United States, in most cases if a wife did not want her marriage to end, the husband would have to provide compensation to induce her to be the plaintiff and to give the necessary testimony to establish fault. Fault grounds for divorce afforded the spouse who wanted to continue the marriage with considerable negotiating power. The economic problem with so-called no fault divorce is that it encourages divorce when the benefits to each impacted person, including children, may not balance with the costs.

In today's environment (1), it is important to assess the social decision-making process in connection with divorce relative to the principles of altruism, fairness, and morality. Altruistic behavior can be explained as unselfishness and a devotion to the welfare of others. Economists discuss altruism in the context of Samuelson's "overlapping generations model" (1958), with its focus on bequests of material goods. Of course, his theory does not need the bequests to be transfer of material goods to children after death. In fact, a recent article by Cardia and Michel (2004) cited reports that have included time transfer in addition to material bequests in the analysis of childcare. Relatedly, fair behavior in social decision-making can be explained as impartiality, while moral behavior can be explained as conformance to the rules of right human conduct.

Since the advent of no fault, most of the responsibility for the moral choice whether to divorce has been transferred from the law to the husband and wife [Schneider (1985)]. Marriage is less of a sacred contract whose enforceability was previously easier. The penalty (i.e., alimony) has been reduced, making divorce a more appealing option for the party seeking it. While the weakening of the social sanctions against divorce may be considered to be beneficial, the existence of broader exit options can cause couples to marry less wisely and to invest less heavily in marriage.

Marital property has replaced alimony as the primary remedy in no fault. Since the central component of many divorce settlements is the division of marital assets, Gray (1996) reported that an unintended consequence has been an insufficient amount of property accumulation. With a smaller share of property after a divorce, there is often a need for the wife to sell the marital residence to start over. Brinig (2000) has noted that regardless of whether a settlement is based on fault or no fault divorce, on average wives have received approximately 50% of the marital assets and 75% of the custody share (i.e., time with the child). Clearly, no fault divorce has been closely related with the rise in married women seeking work outside the home as a means of financial protection. Unfortunately, the cost involved is often the dysfunction that is created for the family unit. No fault, in the context of the overall welfare of children, is inefficient.

Writers have long debated whether children whose parents divorce suffer long-term harm [Wallerstein and Blakeslee (1989); Whitehead (1993); Harris (1998)]. Brinig (1998) determined that only with the exception of the most conflicted marriages, children of divorce fare worse than children of marriage. …

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