The Economic Consequences of Divorce

In order to evaluate properly rising incidence of divorce in United States we need to know its consequences for families and society at large. This paper focuses on questions: (1) what does divorce mean in way of economic hardship for family members; (2) how is burden distributed among husbands, wives, and children; and (3) why does economic well-being of divorced wives typically fall short of that of former husbands? The analysis is based mainly on findings of microlevel longitudinal surveys in United States, and we conclude that an explanation revolves around lost economies ofscale, the selective nature of divorce, work versus welfare, and inadequacy of child support and alimony.