Fabio Blasutto (UC Louvain) will present "The Rise of Cohabitation and Unilateral Divorce" with Egor Kozlov.

Abstract :
This paper analyzes the role of unilateral divorce for the rise of cohabitation. Exploiting the staggered introduction of unilateral divorce across the US states, we show that after the reform singles become more likely to cohabit than to marry, and that newly formed cohabitations last longer. We then provide a theoretical rationale for these facts, building a life-cycle model with partnership choice, female labor force participation and saving decisions. A structural estimation of the model suggests that unilateral divorce decreases couples’ stability, which makes cohabitation preferred to couples that would have been at high risk of divorce. Since cohabiting couples formed after the reform are better matched, the average length of cohabitations increases. A counterfactual experiment reveals that the time spent cohabiting would have been halved if divorce laws had never changed.