Marriage is a natural subject for law & economics scholars. From Gary Becker’s “A Treatise on the Family” (1981) to Margaret Brinig’s “From Contract to Covenant” (2000), scholars have expanded our understanding of romantic love by examining it through an economic lens.
Some object that bringing law & economics into marriage risks coarsening and cheapening this fundamental institution. That concern is noble, but it overlooks history and mistakes scholarship for advice. Marriage’s deep association with romantic love is itself partly the result of a legal change: the medieval church’s adoption of dispositive spousal consent, under which the spouses’ consent determined whether a marriage was valid (Berman 1985, Piano and Piano 2025). Far from being removed from legal analysis and price theory, marriage’s beauty and complexity cannot be fully appreciated without these tools.
Although most couples view marriage as more than a contract, it is at least a contract with both economic and legal purposes. Saying that marriage has an economic purpose does not mean that it maximizes wealth, although it usually does. It means that marriage solves coordination problems between two people.
Likewise, saying that marriage has a legal purpose does not mean that the state must regulate it, although it usually does. It means that marriage solves coordination problems between the couple and the rest of society. In “The Economics of the Marriage Contract: Theories and Evidence” (2008), Niko Matouschek and Imran Rasul ask: What exactly are the coordination problems that the marriage contract solves?
Why People Marry and What Divorce Law Reveals
The literature offers three main hypotheses for why people marry:
- Marriage generates a joint surplus—the surplus hypothesis.
- Marriage signals a person’s quality as a companion—the signaling hypothesis.
- Marriage helps people keep their promises and rely on their partners to do the same—the commitment-device hypothesis.
Matouschek and Rasul test these theories by examining changes in the likelihood of divorce after states adopted unilateral-divorce laws, which allow one spouse to obtain a divorce without the other’s consent. The fact that divorce rates changed significantly after these laws took effect suggests substantial transaction costs within marriage, as the authors note. These costs prevent Coasean bargaining—the private negotiation that might otherwise allow couples to adjust to the legal change without divorcing. Law & economics scholars have spilled considerable ink explaining why these costs arise, e.g., Becker, Landes, & Michael (1977), Cohen (1987), and Brinig (1993).
In every model of marriage, changing the cost of divorce affects both couples who are already married and the types of couples who later choose to marry. The three leading hypotheses—marriage as surplus, signal, or commitment device—make the same prediction for existing marriages. After divorce becomes less costly, the likelihood of divorce initially rises. Over time, it falls because poorly matched couples have already separated, leaving a pool of more stable, higher-quality marriages.
But the models diverge in their predictions about who marries after divorce becomes less costly. In other words, the characteristics of couples who marry under the new rules reveal what the marriage contract does for them.
If marriage credibly signals an underlying quality or gives spouses benefits that exist independently of their commitment, reducing the cost of divorce makes marriage less risky by lowering the chance of becoming trapped in a bad match. The benefits of marriage remain unchanged. Under either hypothesis, the share of the population marrying should rise after divorce laws are liberalized. Couples with relatively poor matches who would have avoided marriage when divorce was costly now choose to marry. Divorce rates should also remain elevated as these couples exercise the option to leave.
The commitment-device hypothesis yields a different prediction. If couples use marriage to secure commitment and encourage relationship-specific investments, both the marriage rate and the divorce rate among those marriages should fall after divorce becomes less costly. Together, those changes would indicate an increase in average match quality.
Lower divorce costs weaken marriage as a commitment device, so only very strong matches clear the threshold for marriage. Couples in relatively poor or risky matches will tend to choose cohabitation instead. Even under unilateral divorce, leaving a marriage remains costlier than ending a cohabiting relationship.
It is worth pausing to explain why relationship-specific investments matter to marriage. The concept, also called asset specificity, comes from the transaction-cost literature. Benjamin Klein, Robert Crawford, and Armen Alchian (1978) explain that opportunism can arise after two parties enter a contract when one or both make investments that are more valuable within their relationship than outside it, such as building a machine for a particular buyer.
In a romantic relationship, marriage can play a role similar to vertical integration, in which two parties formally combine to protect and coordinate their joint investments. As a commitment device, marriage reduces the risk of investing in things that derive much of their value from the relationship—such as having children, taking dancing lessons, or learning to cook a spouse’s favorite meal.
What the Evidence Says About Marriage
Using individual marriage and divorce certificates from across the United States, Matouschek and Rasul test each hypothesis by comparing outcomes before and after states adopted unilateral-divorce laws. They find that the likelihood of divorce rises by 18.5% after a state adopts unilateral divorce, then falls as relatively poor-quality matches leave the pool of married couples. This pattern is consistent with all three theories of marriage.
Couples who married several years after a state adopted unilateral divorce, however, were significantly less likely to divorce. The authors conclude: “The sign of this selection effect implies that the first-order purpose of the marital contract is to serve as a commitment device” (Matouschek and Rasul 2008, p. 93).
Matouschek and Rasul also find that the effects vary with states’ labor markets and social characteristics. They examine several measures of women’s bargaining power within marriage, including the female labor-force-participation rate. In states where women have relatively greater bargaining power, couples are less likely to divorce with each additional year under unilateral divorce.
The authors suggest that this finding may offer further evidence of positive assortative mating—the well-documented tendency of people to marry partners with similar characteristics. Cooperation between these spouses may come more naturally and therefore respond less to changes in divorce law.
The authors also examine differences in the Catholic share of each state’s population. In states with an above-average Catholic population, couples become even less likely to divorce over time. Matouschek and Rasul interpret this finding as evidence that Catholics are more likely than non-Catholics to use marriage as a commitment device.
The Enduring Value of Marital Commitment
Most theories of marriage struggle to explain what couples gain from it beyond a division of labor and economies of scale, both of which cohabitation can also provide. Matouschek and Rasul’s distinctive contribution is to separate the competing theories of marriage and test their different predictions against high-quality data. More recent studies, including Edlund (2013) and Lafortune and Low (2017), provide further evidence that the marriage contract’s value—from the perspective of couples themselves—depends on its ability to secure commitment from both partners.
Law & economics scholars have made substantial contributions by turning their attention to marriage. Yet each answer raises more questions. Who benefits from prenuptial agreements (Leeson and Pierson 2016)? How could voting systems better represent children’s interests (Kleinfield and Sachs 2025)? Do policies designed to encourage childbirth distort marriage markets (Baudin and Stelter 2026)?
Far from debasing marriage, scholarly inquiry reveals an institution even more compelling and mysterious than it first appears. We need not fear ever reaching the bottom of it.
Further Reading
- Niko Matouschek and Imran Rasul, “The Economics of the Marriage Contract: Theories and Evidence,” The Journal of Law and Economics, Vol. 51, No. 1 (2008).
- Gary S. Becker and Kevin M. Murphy, “The Family and the State,” The Journal of Law and Economics, Vol. 31, No. 1 (1988).
- Lena Edlund, “The Role of Paternity Presumption and Custodial Rights for Understanding Marriage Patterns,” Economica, Vol. 80, No. 320 (2013).
- Matthias Doepke and Fabian Kindermann, “Bargaining over Babies: Theory, Evidence, and Policy Implications,” American Economic Review, Vol. 109, No. 9 (2019).
- Jeanne Lafortune and Corinne Low, “Collateralized Marriage,” American Economic Journal: Applied Economics, Vol. 15, No. 4 (Oct. 2023).
- Joshua Kleinfeld and Stephen E. Sachs, “Give Parents the Vote,” Notre Dame Law Review, Vol. 100, No. 3 (2025).
- Clara Piano and Ennio Piano, “The Medieval Origins of Spousal Consent,” SSRN Electronic Journal (Sept. 16, 2025)
