Till Money Us Do Part: Property Division at Divorce and Married Couples’ Time Behaviour

This paper analyses the effects of different marital property regimes on the marriage-specific investments of the spouses. In particular, it provides an empirical assessment of the effects of a change from a separation property regime towards a more equal distribution of matrimonial assets on labour supply, housework time, and childcare, taking advantage of a decision by the English House of Lord in 2000. I use a difference-indifference approach, with individual fixed effects. Results show that married women reduced their labour supply by about 1.5-2.5 hours per week when the property regime is more favourable to them (slightly more if overtime is included). They didn’t change the number of hours devoted to housework, but the probability that they are mainly responsible for children increased by 5-9%. The results hide heterogeneities: as expected, the effects are significant for women in couples with higher level of assets and wealth (proxied by education), while no effect is found among low educated women.