Game Theory in Marriage
1 Overview
Each year, over two million couples are married in the United States but nearly half of these
marriages will end in divorce1. Given the high rate of divorce, one might assume the use of pre-
marriage contracts (also referred to herein as prenuptial agreements) would be equally high.
However, only 5-10% of married couples typically sign pre-marriage contracts, while the rest forge
ahead into what Samuel Johnson called a “ triumph of hope over experience.”
This paper attempts to explain the paradox, understand individuals’ behaviors as they relate to
marriage, divorce and the use of pre-nuptial agreements. We have used the principles of game
theory to predict an equilibrium outcome relating to the use of prenuptial agreements and to
explain deviations from this outcome.
2 Background on Pre-marriage Agreements
A pre-marriage contract, also referred to as a prenuptial agreement or “ pre-nup,” is a legal contract
entered by both parties prior to marriage that defines expectations for behavior during the
marriage and sets guidelines for property division in the event of the dissolution of the marriage.
Legally speaking, a marriage is a private contract between two people who voluntarily agree to
enter a spousal relationship. 2 Couples entering into a marriage become united in many
dimensions, including social and financial. Financially, the concept of community property binds
the assets and debts of one spouse to those of the other’ s.
Plunkett, Robert L. “Divorce Laws Should Be Reformed.” Marriage and Divorce. Eds. Tamara L. Roleff and Mary E. Williams. Current Controversies Series. Greenhaven Press, 1997. From Robert L. Plunkett, "Vow for Now," National Review, May 29, 1995; (c) 1995 by National Review, New York, NY. Rpt. by permission. Opposing Viewpoints Resource Center. Thompson Gale. 15 June 2005
The marriage contract is essentially a monopoly document. It represents a legally sanctioned collusive agreement between two parties to exclude competitors and restrain trade. It closes the market to competition, or at least it is supposed to. This collusion has benefits as well as costs. Because I have exclusive rights to her affections and property rights to a stream of highly valued domestic services, I place a higher value on my spouse, making me willing to share with her a greater percentage of my wealth. My spouse receives a comparable set of benefits from this collusive arrangement.
For Centuries in our society marriage between man and woman has been a practiced cultural right and custom. Over 90% of Americans will marry in their lifetime and roughly 50% of those marriages will result in Divorce. Many Sociological factors contribute to the high divorce rate expressed in our culture. Reasons that contribute to the divorce rate are longer life expectancy, women in the work force, birth control, social acceptance of cohabitation, single parenting and welfare reform. It is also now socially acceptable and legal to get a divorce due to dissatisfaction and unhappiness. This social acceptance of divorce implies that today there is a changing criteria when entering marriage. Couples today now insist on the element of personal fulfillment and happiness for entering wedlock, where as, in times past this was not one of the main considerations for man and woman to get married.
Reaching an agreement about property and support issues before a marriage occurs can make life easier in the event of divorce or death. Those who already have children or who have substantial assets may benefit the most from sitting down and working these issues out before getting married.
Currently in the United States, divorce has always been present in society but more significantly after the Civil War. Today, it is estimated that 40%-50% of married couples divorce and subsequent marriages is even higher (“Marriage and Divorce”). When couples seek divorce, it is merely a formal dissolution of a marriage. Every divorce case is different and must find an agreement on issues they once shared. The couples may need to divide there assets, debt, and child custody. Just because the divorce is over, the partners will continue to have some type of relationship in order to meet with court’s final agreements. The divorce rates started to increase when Ronald Reagan signed the nations’ first no-fault divorce bill in 1969 (Wilcox, 2009). A “no-fault” divorce simply means that neither partner in the relationship does not have to have a valid reason or prove that the other partner did something wrong. Many have used the term “irreconcilable differences” where the couple do not see eye to eye anymore. Shortly after the divorce reform, almost every state had some form of “no-fault” divorce law.
They wanted to be open to addressing Bob’s concerns about the impending marriage while also expressing their own opinions about a prenuptial agreement. Due to their age and preconceived notions about prenuptial agreements, Edith and Stanley did not feel it was necessary to sign one. Many individuals may also value these same beliefs and feel that a prenuptial agreement may lead to uncertainty about the marriage or feel it is not necessary because they do not plan on divorcing (Mahar, 2003). Edith and Stanley felt that through a family therapy session they may explain their feelings to Bob and have him understand that not every marriage ends in divorce especially due to the couple’s age. Bob was also motivated to attend the session and attempt to express his
The Supreme Court of Canada defines marriage as between two people with different gender. As time passes, the society changes as well as the law. “The law is a vital force in society: it is a skeleton that structures our economic, social and political lives” (Boyd, 2011).
Marriage is perhaps the most unique contract among all others. Not only does it serve as an emblem for a couple’s love and commitment, but it also holds strong ties to national policy and jurisdiction. Throughout American history, marriage ideals and the paradigm of consensual monogamy have been strongly enforced. By implementing certain policies and excluding other alternatives to marriage, marital laws have essentially promoted monogamous marriage as well as shaped people’s understandings of societal roles. Specifically, the role of women has evolved within the constraints of marriage.
Every year approximately 2.4 million marriages occur.Out of those,2.1 millionwill file for divorce in the United States. These marriage and divorce rates have significantly increased since the years past(Coltrane and Adams, 364).According to Schoen, in the 1950’s, 15 out of 1,000 marriages ended in divorce.In the 1970’s, the rates of divorcedoubled,increasing to 40 per 1,000 marriages. Currently, the rate of marriages resulting in divorce remains the same. Most marriages are ending within seven years ofthemarriage for multiple different reasons. Sociologists haveestablisheddivorce as a social problem from the rise in divorcerates due to the early year of marriages (2006).
Marriage is a commitment that seems to be getting harder to keep. The social standards placed on an individual by society and influenced by the media inevitably lead some to consider divorce as a “quick-fix” option. “Have it your way” has become a motto in the United States. It has become a country without any consideration of the psychological effects of marriage and divorce. The overwhelmingly high divorce rate is caused by a lack of moral beliefs and marital expectations.
Throughout the last half of the century, our society has watched the divorce rate of married couples skyrocket to numbers previously not seen. Although their has been a slight decline in divorce rates, “half of first marriages still were expected to dissolve before death.” (Stacy, 15, 1991) Whatever happened to that meaningful exchange of words, “until death do us part,” uttered by the bride and groom to each other on their wedding day? What could have been the cause of such inflated divorce rates? Perhaps young married couples are not mature enough to be engaged in such a trremendous responsibility, or, maybe, the couples really do not know each other as well as they thought. Possibly, they have been blinded by infatuation rather than by true love, or, quite simply, the couples mistakenly have different relational expectations.
Relationships are all about give and take, and to maintain that balance people must be willing to do the work. Today dissolution of marriage is being used as the easy way out when couples no longer agree. When couples are incapable of maintaining a happy marriage, a divorce can be agreed upon. Divorce is more common nowadays, making the divorce rate a continual increase. About 40 to 50 percent of married couples in the United States divorce (Kazdin). In America, there is one divorce every 13 seconds. That’s 6,646 divorces per day, and 46,523 divorce per week (Irvin). The three main causes of divorce is the lack of communication, financial difficulties, and infidelity.
...bligation towards their children , it may be unfair if the parties’ assets are to be decided only according to the pre-nuptial agreement . The Law commission also states that the court will have to access; fairness, financial needs of both the parties, entitlement to compensation, as it would be unfair to hold the parties to the agreement instead of making an order in different terms . The “Real need” of the parties will also have to be taken into account besides deciding whether the agreement is fair. Lord Philips identified it as: “Compensation of long-term financial consequences generated by the devotion of one partner to the family at home” . When the marriage comes to an end and both parties decided to live on their separate ways, if would be unfair to hold their agreement if one partner left in a predicament of real need and another party enjoys a sufficiency.
A prenuptial agreement (sometimes called a pre-nup, premarital agreement, or prenuptial contract) is an arrangement entered into by a couple before they get married. This agreement is designed to regulate what should happen if a marriage breaks down and ends in divorce.
In 1960, two-thirds (68%) of all twenty-somethings were married. In 2008, just 26% were. Today that number is declining more in the United States based on an income-gap (Pew Research Center).