HOUSING DECISION WITH DIVORCE RISK

• 成果类型: Article
• 署名作者: Fischer, Marcel; Khorunzhina, Natalia
• 署名单位: University of Konstanz; Copenhagen Business School
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12385
• 发表日期: 2019
• 页码: 1263-1290
• 关键词: portfolio choice; income shocks; consumption; marriage; FAMILY; MARKET; CHILDREN; IMPACT; MODEL; fertility

摘要

We build a life-cycle model of housing decisions under divorce risk that predicts that the recent increase in divorce rates leads to reduced homeownership rates. The risk of a divorce triggers a precautionary-savings motive. However, this motive is weaker when individuals can invest in owner-occupied homes because homeowners' higher savings partially substitute for precautionary savings. When young, the larger asset accumulation due to divorce-risk-induced precautionary savings enables households to buy homes earlier, whereas the presence of transaction costs leads to reduced homeownership for middle-aged and older households when divorce risk goes up.