"Why Men Shouldn’t Marry"
Stuart Birks
Based on a presentation at "Real Time", 8 September 1998
Massey University, Palmerston North, New Zealand
A large proportion of current research is "gendered". In other words, it takes a gender-based perspective for grouping data, determining objectives and identifying impacts. "Gender analysis" is now required as a part of the policy-making process. As defined in New Zealand in Ministry of Women’s Affairs (1996), this gender analysis takes a women’s perspective only and "aims to achieve positive change for women". Here I will take a gendered perspective focusing on men.
Why marry?
Despite sentiment, we should note that the main function of a marriage contract is economic. It sets the rules for division of assets in the event of a marriage coming to an end. This raises important questions as to whether the contract is appropriate for the situation, and whether the parties are well informed when they inter into a contract.
The July 1998 issue of the Law and Economics Association of New Zealand Newsletter contains a paper by Terence Arnold QC, "What’s Mine is Mine and What’s Yours is Mine?". He suggests that, according to economists, a couple’s objective function is set to maximise income (so they specialise):
"Economists have tended to look at the marriage unit as a firm seeking to maximise the joint production and acquisition of commodities … people marry because they expect to increase their individual welfare (i.e. they would have more resources, goods or commodities available to them than they would have if they remained single)."
In other words, it is assumed that men marry to make money. No weight is put on the idea of wanting a family, to be a parent, companionship, etc..
From this thinking, it can easily be determined that the main asset of a marriage is the man’s earning power, hence suggestions that post-separation income should be considered as part of the property to be divided. Bridge (1992) suggests an equalisation of post-separation outcomes. What does this mean?
The New Zealand Matrimonial Property Act is based on a presumption of equal contribution to the marriage, hence the concept of equal sharing. Equalisation of post-separation outcomes, focusing on monetary aspects only, means that there would be a sharing of the proceeds of unpaid work for the period of the marriage, and a sharing of the proceeds of paid work for life. This rule would apply after only 3 years of marriage. (Given the three year criterion, men may find a greater attraction in serial relationships of shorter duration than this.)
Even with current rules, the marriage contract under the Matrimonial Property Act has some strange economic characteristics (Birks, 1994, part 4):
(i) The financial price paid is set according to the circumstances, past, present and future, of the payer. This is the reverse of the case in normal market transactions, where the price is specified in terms of the good or service being purchased. If two men, A and B, wish to marry the same woman, but A earns twice as much as B (and they have no assets), the price for A would be twice the price for B. It is not clear that A would be getting any more than B in return. This is an extreme case of price discrimination in that there may be a different price for each potential purchaser. (For first degree price discrimination, prices should be set separately for each purchaser such that there is no consumer surplus remaining.) It is also likely to be highly inefficient in terms of utility maximisation. This is because the share of income spent on a spouse is fixed. It is not possible for A to marry and pay B's price, thereby having more money for other purchases, retirement, or children from an earlier marriage, for example.
(ii) As a man's income changes, spousal payments change proportionately. This is entirely independent of spousal contribution to the relationship. Disregarding any public good components to household expenditure, this means that he faces a very high effective marginal tax rate (perhaps we should talk about a "relationship tax" which is levied to provide transfer payments to his spouse). This will affect the labour-leisure decision, but in which direction is not clear.
(iii) The amount of unpaid work done by the spouse is independent of the payment made, ceteris paribus.
(iv) Once a marriage has been entered into, there is no competition for the supply of unpaid labour. Given the high entry and, perhaps more importantly, exit costs to the purchaser, it is doubtful that the market could even be called contestable. (If a market is contestable, then a single supplier still has to operate as if facing competition, otherwise another, more competitive, supplier could enter the market. The contestability criterion can be used to assess whether a monopolist is able to behave inappropriately.) If we view the relationship as one of employer-employee, there is the extraordinary situation that redundancy or resignation carries a redundancy (or resignation) payment equal to half the value of the "company". If we view the relationship as a partnership, distribution of income and assets within the partnership is based on presumed equal equity holdings and (usually) takes no account of possible differences in labour input.
(v) A case could be made that legislation and discussion about legislation is strongly influenced by the presumption that marriage is for life, with the minor allowance for marriages of "short duration", i.e. up to three years. The reality for many couples is very different. The regulations set by law are therefore often likely to be inappropriate, particularly for second and subsequent marriages.
(vi) Law changes can occur during a marriage that alter the terms of the agreement voluntarily entered into. There is little scope for renegotiation at that point.
(vii) There are no penalty clauses if either of the parties fails to deliver, as with say a wife who refuses to undertake paid work, or who chooses a more pleasant, but lower paid job than was expected, or otherwise underperforms in relation to unpaid work. Cowan and Kinder (1986, pp.46-55) provide an interesting description of the phenomenon of "hidden dependency needs" which illustrates this point very well. Men might also fail to deliver, but we are looking here at what the man receives.
As a further point, there is no guarantee that the results of paid and unpaid labour during a relationship benefit both partners equally. The question of equality on the financial side has been studied (Easting and Fleming, 1994), but I have not come across any studies on the extent to which unpaid labour is applied to meet individual partners' needs.
There are also problems with the specification and valuation of matrimonial property, some aspects of which are discussed in Birks (1994). In particular by New Zealand law, assets, including superannuation, accumulated before a marriage are frequently included. Superannuation valuations are used as a basis for cash payouts in settlement to the other spouse. These are based on an assumption that retirement will occur at 60, rather than the more likely age of 65. An interest rate of about three percent is used to calculate value at separation, whereas the settlement payment is likely to affect the sizes of the parties’ mortgages, on which the rate is nearer eight or ten percent. Both of these factors suggest that the values used are too high. In addition to these points, there is an additional issue of a superannuation surcharge. Contributory superannuation schemes are valued on the assumption that payouts are tax free. This is currently technically correct, but these payouts may affect other entitlements and hence would carry a positive effective tax rate. In that event, they are overvalued in the matrimonial property calculations and cash payments to ex-spouses on that basis would be further inflated.
While the terms of the contract are unlikely to be considered suitable for a business transaction, it would appear that many men blindly submit to its terms through marriage. This could be a mistake as there are several worrying aspects about the reasoning currently being applied in the development of family law and in the application of existing law.
Men are assumed to do very well out of marriage simply because they continue in paid work. Their family and their children are considered of no importance. All circumstances are considered to be due to the marriage, rather than the result of human capital investments, etc., from before the marriage. Effort and sacrifice put into earning is disregarded.
Currently 40% of New Zealand marriages end in divorce (Jefferson, 1998, p.339). In rough figures, 20% of separations are by mutual agreement, 20% are initiated by the men, and 60% by the women (Maxwell and Robertson, 1993, p. 37). It only takes one partner to decide to separate. From child support payment data, in 1991 84% of custodial parents were women (Child Support Act Working Party, 1994, p. 5), and of the remaining 16% who were men, some would have had a shared custody arrangement. Most separated fathers are non-custodial, and contact commonly declines rapidly after separation. One large US study found that a third of children had seen their non-resident parent at most once in the previous year (Seltzer, 1991, p.86). The Family Court does not support shared custody arrangements (Birks, 1998b, section 2.2) and does not enforce orders breached by custodial mothers (Birks 1998a, pp.41-2). Many men will find that, against their will, their marriages are ended and they lose contact with their children, while still being obliged to support their families financially.
In summary, marriage is currently a high risk activity for men.
References
Birks S. (1994) Women, Families and Unpaid Work, Discussion Paper No. 94.9, School of Applied and International Economics, Massey University
Birks S (1998a) Gender Analysis and the Women’s Access to Justice Project, Issues Paper Number 2, Centre for Public Policy Evaluation, Massey University
Birks S (1998b) "Gender, Policy and Social Engineering", paper presented at the New Zealand Association of Economists 1998 Annual Conference, Wellington, 3 September
Bridge C (1992) "Reallocation of Property After Marriage Breakdown: the Matrimonial Property Act 1976", in Henaghan M and Atkin B (eds.) Family Law Policy in New Zealand, Oxford: Oxford UP
Child Support Act Working Party (1994) Child Support Review 1994: A consultative document, Wellington: Inland Revenue
Cowan C and Kinder M (1986) Smart Women Foolish Choices, New York: Bantam
Easting S K and Fleming R (1994) Families, Money and Policy, Intra Family Income Project, Wellington and Social Policy Research Centre, Massey University
Jefferson S (1998) "The Family Court in 2015: directions, challenges and threats – a polemic", in Family Law Conference, 31st August – 2nd September1998, New Zealand Law Society
Maxwell G M and Robertson J P (1993) Moving Apart: A Study of the Role of Family Court Counselling Services, Department of Justice
Ministry of Women's Affairs (1996) The Full Picture: Guidelines for Gender Analysis
Seltzer J A 1991 "Relationships between Fathers and Children Who Live Apart: The Father's Role after Separation." Journal of Marriage and the Family 53(1): 79-101
Prepared for the web, 10 September 1998