Few situations have ever been as idyllic as the traditional family portrayed in the 1950s television series Father Knows Best. So it's natural for politicians, especially those of a conservative bent, to glorify the family of an earlier era and call for its reestablishment. Last year's Murphy Brown–inspired controversy about "family values" reflected the power of this theme.
Certainly families of the kind depicted in Father Knows Best have declined in recent decades. The proportion of American adults who are married is falling, the share of children born to unwed mothers has soared, and most Americans under age 18 will spend part of their childhoods living with only one parent. A look at a few statistics confirms the move away from traditional marriage and family patterns:
• The percentage of households consisting of married couples fell from 79 percent in 1950 to 55 percent in 1991.
• Non-family households—mostly people who live alone—grew from 10 percent to 30 percent of households during the same period.
• Between 1956 and 1990, the median age at first marriage rose from 20.1 to 24 for women and from 22.5 to 26 for men.
• Since 1950, the percentage of American families headed by women has nearly doubled, to 17 percent.
• Thirty-one percent of one-parent families are now headed by never-married women, in contrast to 6.5 percent in 1970.
During last year's presidential campaign, candidates responded to these changes with a variety of polemics and proposed solutions. But the debate ignored one of the most important factors behind the decline of the American family: government regulation of marriage and divorce. In particular, the shift to no-fault divorce is a major reason family life has become less attractive to many Americans. Under the no-fault divorce laws of most states, one spouse may unilaterally dissolve a marriage. These laws have reduced the incentives for spouses to commit themselves to their relationship and have caused many other people to either delay or forgo marriage.
Decrying these developments, some conservatives have called for a return to the old, fault-based divorce regime, under which marriages were harder to dissolve. But that system was abandoned because many people were dissatisfied with it, just as many are dissatisfied with current marriage laws. Rather than adopt a different one-size-fits-all solution, the government should give couples embarking upon marriage the freedom to make whatever arrangements best suit their needs and desires. This could be accomplished if the states simply extended to marriage agreements the same latitude as commercial contracts.
The government's role in regulating marriage has moral and religious roots, but it is also an attempt to stop individuals from imposing costs on other members of society. Children born out of wedlock can be a burden on others, since they are more likely to need outside support, whether private charity or public welfare. This problem was magnified in a world of limited contraceptives and low incomes. Government therefore established penalties for sex outside of marriage. Richard Posner, a federal appeals-court judge and law-and-economics scholar, argues that the history of public policy toward sex since the beginning of the Christian era is a history of efforts to confine sexual activity to marriage.
In addition to the stick of government penalties, the carrot of economic incentives has tended to encourage marriage. Economist and Nobel laureate Gary Becker argues that marriage is reinforced not only by romance and sexual attraction but also by the extra goods and services that married couples and their children can enjoy.
Some of these benefits come simply from sharing a household. People who live together can increase their welfare through both specialization and joint consumption. For example, one person can do the shopping while the other does the cooking, instead of each performing both activities. Not only do they economize on their time, they become more proficient at each activity. In addition, sharing goods or services can reduce total expenses. For instance, two people who are willing to watch the same television programs can get by with one television set rather than two.
These examples of specialization and joint consumption explain why people live together, not necessarily why they marry. The economic logic behind marriage is based on forms of specialization that involve long-term costs. There are few long-term costs when roommates assume roles as shopper and cook. If the arrangement ends, neither party is worse off than he would have been had he never entered the relationship in the first place. But if one person specializes in earning an income and the other specializes in domestic work, the second person can find herself worse off if the arrangement is dissolved than she would have been had she never been married.
Couples often arrive at this breadwinner/homemaker arrangement after deciding to have children. It usually costs more for both parents to assume equal shares of child rearing than for one to assume primary responsibility. Say the mother is a corporate lawyer, a job that requires her to be at a particular place for specific hours, with occasional, unanticipated overtime. She could find a more-flexible job, but only at the cost of a substantial reduction in her income. Meanwhile, the father is a free-lance writer, a job that pays according to how much work he produces and allows him to set his own hours. Under those circumstances, it probably makes sense for the father to assume the main child-rearing responsibility.
But the domestic efforts of the father, especially the child rearing, tend to occur during the early part of the relationship. The contribution of the income-earning parent, on the other hand, tends to increase over time. If the relationship is eventually dissolved, the mother, who has specialized in income earning during the marriage, would lose the services provided by the father, who worked at home, but these services may have limited value after the children have left. Meanwhile, the parent who has worked at home has skills with limited market value; he suffers long-term costs because he decided to specialize in domestic work.
Because of this potential asymmetry, most couples who want children marry with the understanding that it is a longterm arrangement. While marriage has many similarities to a commercial contract, the state has regulated it heavily, usually under the rationale of protecting children. In past centuries, because people married when they were older and had shorter life expectancies, children were dependent on their parents for most of their parents' lives. In addition, few men—the main source of income—were able to support more than one family, so marriage had to be a permanent relationship. To protect the children, the parties had to recognize that a marriage would be difficult or impossible to dissolve.
Between 1602 and 1857, for example, only 317 divorces were granted in England, and they were all based on private acts of Parliament. Conditions were less strict in the United States, but divorce was still difficult. The Constitution gave the states jurisdiction over marriage and divorce, and some had established grounds for divorce from the very beginning. When divorce was permitted, the grounds were based on the fault of a spouse: desertion, adultery, or cruelty. Because of the federal system, people could move from a state with strict grounds to one with liberal grounds if they wanted to end their marriage.
Until recently, the marriage laws corresponded pretty well with the preferences of most people. But conditions have changed. With improved forms of contraception, people can have active sex lives without fear of pregnancy. Higher incomes have enabled one person to support more than one family. Increased social tolerance has allowed homosexual couples to establish open relationships.
As the earnings and opportunities available to men and women have become more similar, the gains from specialization during marriage have dropped. When women had few alternatives to marriage, marriage could mean a substantial increase in their welfare. In the absence of domestic labor-saving devices and convenient, ready-made food, men also could increase their welfare through marriage. In both cases, the growth of alternatives reduced the gains from marriage.
Higher earnings for women also mean that children tend to cost more, since women who assume the child-rearing role often have to sacrifice or limit their employment. The increased cost of raising children has further reduced the desirability of marriage. (Most couples who choose to live together without marrying do not have children.)
With these changes, some people discovered after marriage that they were not realizing the gains they had anticipated. Reflecting this re-evaluation, the divorce rate rose from 1.6 per 1,000 people in 1920 to 3.5 per 1,000 population in 1970. Since fault grounds for divorce did not conform to these individuals' preferences, they took steps to get around the laws.
Increasingly, divorces were uncontested. Parties who wanted a divorce used fabricated testimony, usually "proving" cruelty, to establish the necessary legal grounds. Since the plaintiff in such divorce cases had to be the innocent party, the defendant was usually the person who wanted the divorce and who obtained the cooperation of the other party by promising compensation. In effect, the divorce was based on mutual consent. The requirement of mutual consent for divorce provided some protection for spouses who had specialized in domestic work during marriage.
Individuals forced to fabricate testimony to establish the grounds for divorce suffered embarrassment and inconvenience (as well as the risk of perjury charges). In addition, some legal scholars found the fault grounds for divorce hypocritical. As a result, a movement developed to change the grounds for divorce from fault to no-fault. Between 1969 and 1985, all the states enacted laws that either replaced the fault grounds for divorce with no-fault grounds (such as "incompatibility" or "irretrievable breakdown") or added no-fault grounds to the existing fault grounds. While some states required agreement on the no-fault grounds, in most states divorce became effectively unilateral.
No-fault divorce was promoted by people, such as divorced men and career women, who did not appreciate the advantages of marriage as an arrangement that could be dissolved only with mutual consent. The people who were willing to assume more-specialized roles during marriage and therefore wanted it to be a long-term arrangement were conspicuously absent from the debate. Instead of requiring mutual consent of the parties, divorce is now based on the preferences of one party, subject to the legal requirement for a property settlement, alimony, and child support and custody.
These laws are extremely unfair to spouses who specialize in domestic work during marriage. Property settlements tend to recognize only physical assets such as houses and cars and financial assets such as stocks and bonds. Largely ignored is the most valuable asset affected by marriage—the parties' income-earning capacities. The person who worked at home will receive little compensation for a career that was sacrificed or restricted to raise a family. Courts once attempted to correct for the financial situation of these people through alimony, but increasingly alimony is designed for a limited period of rehabilitation. The problems that custodial parents have had in collecting child support are legend.
No-fault divorce laws have made it more likely that a given divorce will produce more costs than benefits. The mutual-consent divorces that occurred under the fault-based system required the divorcing spouse to compensate the divorced spouse so that they both felt better off than they would have been had the marriage continued. Hence their combined welfare improved. But under no-fault divorce, the net gain to the divorcing spouse may not exceed the net cost to the divorced spouse and the children. Hence divorce can reduce the total well-being of everyone involved.
Women gradually noticed the adverse effects of no-fault divorce. Married women became aware that divorced women and their children were being treated very poorly at divorce. With limited negotiating power, divorced women were receiving financial settlements lower than what they would have received under the old system. As a result, married women became less willing to specialize in domestic work, recognizing that they needed to maintain or increase their marketable skills during marriage. This awareness contributed to the rise in the labor-force participation rate of married women and to the increase in the number of married women continuing their education during marriage.
These decisions can reduce the welfare of families. With the protection provided by fault divorce, married women often sacrificed employment and education opportunities because the services they provided at home were worth more to the family than the income they lost. This changed with no-fault divorce. Although the whole family still shared the current income loss, if the marriage ended the woman might have to bear the burden of the future income loss alone. With no assurance that the law would take into account the sacrifice involved in specialization, women became less willing to work primarily at home, even when it was in the best interest of their families. Because the government controlled the grounds for divorce, a couple could not create a contract that adequately protected the spouse who chose to specialize in domestic work.
The current no-fault divorce laws do not meet the needs of individuals who want a relationship in which the party who specializes in domestic work receives adequate compensation if the marriage ends. The "marriage contract" provided by law permits unilateral divorce subject to financial and custodial arrangements that can be very unfair to at least one of the parties and the children.
The problem is the limits on the right of individuals to draft their own marriage contracts. The laws treat marriage agreements and commercial agreements differently. When individuals find that the laws governing a particular commercial contract do not serve their best interests, they have broad latitude to draft an agreement that circumvents the laws. For example, the Uniform Commercial Code provides that delivery of a good will be within a "reasonable" time unless the parties specify another time. The law has not traditionally given parties to a marriage agreement similar freedom. They may not alter the basic agreement prescribed by the state.
Many of the conditions of a marriage contract, especially the grounds for divorce, cannot be altered by the parties. So even if a couple want to make their marriage a long-term commitment that can be dissolved only with mutual consent, they are not able to do so. The states have always maintained the exclusive right to prescribe the grounds for divorce. While the parties were given some discretion about financial and custodial arrangements at divorce under the fault system, the courts were unwilling to permit people to make those arrangements at marriage. The courts were antagonistic to premarital agreements because of fears that they would encourage divorce and that no contract could adequately deal with all the circumstances that might confront the parties in a long marriage.
Premarital agreements are coming into wider use because of changes in marital patterns. By the early 1980s, men and women over 30 years of age accounted for 41 percent and 32 percent, respectively, of new marriages. Not only are these people older and therefore more aware of the potential problems associated with marriage, they also bring more assets to their marriages. The increasing divorce rate also means more and more people are marrying repeatedly. In about 45 percent of marriages, at least one party has been married before.
Many courts now uphold premarital agreements, especially when strict standards of fairness are met or for a second marriage. The courts ask whether there was a fair disclosure of the parties' wealth at the time of the contract, how the provisions of the contract compare with the legal support obligations they would replace, and whether enforcement of the contract would make one spouse a burden on society. Courts tend to look more kindly on agreements concerning property settlements than agreements affecting support obligations. Premarital agreements that seek to define or waive support obligations and other essential duties of marriage are likely to be declared invalid. So there is still substantial doubt about the enforceability of premarital agreements.
Many people in the United States would benefit from the more predictable enforcement of premarital and postmarital contracts. The states could enact marriage and divorce laws that are similar to the Uniform Commercial Code, establishing standards that apply except when the parties specify otherwise. For example, no-fault grounds for divorce might be appropriate during the period early in the marriage when the parties are becoming more familiar. When the importance of long-term assurances increases, such as when a child is conceived, the grounds could change to mutual consent. In their contracts, couples who wanted a traditional marriage might choose to make mutual consent the only basis for divorce. Couples who anticipated careers that would not be affected by children might provide for unilateral divorce. Marriage contracts would allow for homosexual as well as heterosexual relationships.
Because of sentimentality and uncertainty about the future, people find it difficult to draft premarital agreements. Even if they consider a premarital agreement, they may be discouraged because the states control the grounds for divorce, the most obvious condition that they might want to set for themselves. If the government gave spouses control over the grounds for divorce, they might be more likely to consider the other aspects of divorce over which they would like a binding agreement.
We like predictability, and the law often provides it. But predictability does not require uniformity. Rather than dictating a take-it-or-leave-it arrangement, the law should give individuals the opportunity to draft their own marriage contracts, subject to protection for third parties such as children. The result would be an improvement in the quality of family life.
Allen M. Parkman, an economist and lawyer at the University of New Mexico, is the author of No-Fault Divorce: What Went Wrong? (Westview Press).
This article originally appeared in print under the headline "Terms of Endearment".