Family Law

1. Family Law • Why is marriage? • Why has marriage become less common, less stable? • Why have out of wedlock births greatly increased? • 19th century seduction law • Should we legalize the baby market? • The future of marriage and reproduction

2. Why is marriage? • Family as a unit to exploit division of labor makes sense, but … • Why traditionally as a lifetime contract? • Why do long term contracts exist in general? • Firm specific sunk costs create a bilateral monopoly • With opportunities for bargaining cost etc. • So specify the terms in advance • Marriage as an example • Relationship specific sunk costs in • Specializing in being X’s spouse, and … • Shared children • Permanent contract as one solution. • Still room for bargaining within marriage • Partly controlled by traditional roles • Penalties for breach another, but … • Hard to know who is breaching, since … • Quality of performance hard to observe. • Al-Tanukhi story.

3. What has changed? • Divorce more common because such sunk costs reduced by … • Lower infant mortality and … • Division of labor taking much household production out of the house. • But divorce on demand raises a new problem of opportunistic breach, because … • Women perform early, men late, aka • Women depreciate faster than men on the marriage market • So if on demand without penalty, men can engage in opportunistic breach • And women respond by adjusting the timing of performance • Later child-bearing • Less specialization in household production • Both of which have happened • Analogous to my house building story in the previous chapter.

4. Out of Wedlock Births • Have increased enormously over past 40 years • Not only in the U.S. • And not only among the poor • Why? • Welfare? Perhaps. • But that does not explain the increase among the not poor • Perhaps several simultaneous causes? • Gender ratio • More war, less death in childbirth • Shifts the market against women? But not by very much in the U.S. • Rising income? • Why put up with a husband • If you can afford to do without one? • Akerlof Yellin argument—effect of birth control and abortion. • Joint product link—implication. Marriage or commitment if… • Breaking the link improves opportunities for women who like sex and don’t want children, but … • But their competition worsens the opportunity for women who want children. • Men have more opportunity for sex without long term commitment

5. Glittering Bonds • The puzzle: Why the custom of engagement rings • The problem • How can women have sex before marriage without • Risking being seduced and abandoned? • Which badly hurts her value on the marriage market • The legal solution • The tort action for breach of promise • Which was gradually abandoned by U.S. courts • The private solution • The man gives the woman a valuable ring when they get engaged • Sex after engagement is permitted • If the man jilts her, the ring forfeits. A performance bond • The custom declined as • Increasing acceptance of non-marital sex • And better contraception • Reduced the risk

6. Byways of seduction law • 19th c. English and American law • Adult daughter is seduced and pregnant • Father sues, as • Master collecting damages for injury to a servant • The legal explanation • Daughter cannot sue, because fornication is illegal • And she participated • So use the fiction of master servant instead • My explanation • “Seduction” might be a way of evading paternal control over who she married • If she controlled the action, makes tactic work better • If father controls it, makes it work worse

7. Law, sex and markets • The baby market • Why is it illegal for adoptive parents to pay the mother? • She can transfer parental rights • Why can’t she sell them? • Why the strong feeling against it? • Anyone not share it? • Can anyone explain it? • Prostitution • To prevent competition with marriage? • Because it “commodifies” sex? • More generalized puzzle about attitudes towards money • To varying degrees taboo • In social interactions. • Friends might owe me a dinner, but can’t pay with cash • We give gift cards when cash would be easier for both sides

8. Are babies a good thing? • Over population argument, econ version • Children produce negative externalities • So people have too many of them • So we need to limit population increase • What are the negative externalities? • Use scarce land, resources? • As long as those are private property • Consuming them is a cost, but not an external cost • Pollute, commit crime, go on welfare, … • But there are also positive externalities • Make new discoveries from which others benefit • Pay taxes--perhaps to pay for welfare • To make the argument, you need to somehow estimate all of these well enough to sign the sum