The Economics of the Family and Family Policy
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The Economics of the Family and Family Policy

Francisco Cabrillo

This comprehensive and authoritative book offers a global approach to the modern economics of the family, family law and family policy. Beginning with the division of labour in the family, this book deals with the economics of marriage, the demand for children, inter-generational relationships, and the economics of inheritance. The family is analysed using the theory of utility maximisation assuming that individuals wish to achieve the greatest possible satisfaction with limited resources and imperfect knowledge. The family is examined from both long and short term perspectives, and it is assumed that the family is cooperative with incentives for altruistic behaviour greater than in any other social group.
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Chapter 4: Marriage (II)

Francisco Cabrillo


Page 61 4.  Marriage (II) 1  FORMALIZATION OF THE CONTRACT: MARRIAGE OR COHABITATION When establishing a relationship that involves life in common, that is, joint consumption and production, a man and a woman have two possible options—to legally  formalize and register their relationship or simply to live together with no legal formalities. We shall call the first solution marriage and the second cohabitation.  Until fairly recently the choice of the second option meant that the couple relinquished, or were not eligible for, the compulsory provisions of family law with respect to  the rights and duties of spouses and for the purposes of dissolving their relationship. Today the differences between marriage and cohabitation are much less important  because cohabitation also produces legal effects, some of which are similar to those of formal marriage. But marriage still has greater implications and gives rise to a  wider range of obligations and rights for the spouses. The transaction costs of enforcing rights are lower in the case of marriage than in the case of cohabitation because  to claim certain rights as a result of cohabitation it is usually necessary to prove that the relationship existed and lasted for a specific period of time whereas these facts  are proved in marriage by its mere existence. Why should a couple prefer one alternative to the other? In a traditional society, in which cohabitation incurred serious social disapprobation, especially for women, it  was unusual to find this type of cohabitation amongst people who placed a high...

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