Beginning with the seminal article in 1971 by Lucas and Prescott, economists have examined investments under uncertainty in a variety of contexts. Becker et al. (1977) applied this concept to marriage suggesting that increased uncertainty in marriage (i.e., the likelihood of separation or divorce) reduces the incentive for spouses to invest in marriagespecific capital. Several studies have found that reducing the barriers to marital dissolution, through no-fault divorce laws for example, is associated with lower investments in marriage-specific goods (Landes, 1978; Johnson and Skinner, 1986; Peters, 1986; Lommerud, 1988; Lundberg and Rose, 1999; Stevenson, 2007).1 Similar studies have found that with greater uncertainty about paternity, 1 Other papers in economics have examined the impact of outside options in marriage and contracts affecting marital outcomes (Rasul, 2006; Rasul and Mathoushek, 2008; South and Lloyd, 1995). men are less willing to invest in their alleged offspring and more likely to divorce their wives (Alexander, 1974; Anderson et al., 2005). In this paper we examine the relationship between uncertainty and marriage stability in rural Malawi. In particular, we examine how uncertainty about a spouses’ HIV status, and thus the risk of HIV exposure, affects the likelihood of divorce.
March 30, 2015