Rising inflation impacts annual divorce filings
By Lennox Kalifungwa
With inflation rates the highest in 40 years, economists are wondering if divorce rates will soon reach historic highs or plunge to new lows.
While divorce has many causes, economists have long noticed a link between inflation and divorce. Some studies suggest higher inflation as the reason for preserved family ties and stronger marriages. These studies claim that the economic recession causes married couples to consider alternative options other than divorce to reduce costs.
Traders work on the floor of the New York Stock Exchange during morning trading on November 02, 2022 in New York City. Stocks opened low this morning as the Federal Reserve is expected to make a fourth consecutive three-quarter percentage point hike in interest rates, fueling recession fears as it continues to battle inflation. MICHAEL M. SANTIAGO/GETTY IMAGES
“Financial distress has an ambiguous effect on families. For families facing a lot of personal financial stress, this can fuel marital conflict and instability. But, surprisingly, in the general population, it makes people more grateful for their family ties, including their marriages. said W. Bradford Wilcox, director of the National Marriage Project at the University of Virginia. Having taken a keen interest in analyzing the well-being of families across the United States, his insights reveal that although economic instability can be the cause of marital friction, it often results in lower divorce filings. “So at least in the midst of major financial trauma, you typically see marital commitment go up and divorce go down. So if inflation continues to rage, I would expect marriages to be more stable. he says further.
In 1980, the last time inflation was this high, divorce rates fell as the recession deepened. Double-digit unemployment rates and interest rates as high as 21% meant couples could not afford to file for divorce. Divorce rates had been climbing since the 1960s, when no-fault divorce proceedings were enacted. Previously, petitioners had to prove infidelity, addiction, dangerous behavior or some other fault.
People shop at a store in Manhattan on October 26, 2022 in New York City. Inflation, in the form of rising prices for gasoline, food and other consumer goods, is one of the dominant issues on the minds of voters as the country heads towards the November 8 midterm elections. SPENCER PLATT/GETTY IMAGES
During the 2008 financial crisis, economists predicted extremely high divorce rates. This does not happen. Analysts relied on studies suggesting that financial stress was a common reason for marital discord.
“This analysis of the divorce rate among a sample of approximately 2.8 million American women in 2008-2011 provides evidence of the effects of the economic crisis on the chances of divorce. The national divorce rate declined during the recession in this data, dropping from 20.9 per 1,000 married women in 2008 to 19.5 in 2009, before rebounding to 19.8 in 2010.” said Phillip Cohen, professor of sociology at the University of Maryland, in a research paper. “Net of individual-level controls and state fixed effects, the divorce rate fell sharply in 2009, much more than one would expect because of the changing composition of the population of married women. Compared to expectations established in 2008, approximately 150,000 divorces, or 4% of divorces, did not take place in the years 2009-2011.
Some economic analysts believe that the option of divorce during inflation may be different for households and largely depends on their economic status. “Inflation and monetary policy are nuanced and complex things, and do not have a simple or linear impact on different households. To start with inflation, high food and energy prices have a lot more impact. impact on low-income families than on high-income families, as food and energy make up a much larger share of disposable income for low-income households,” said David Bahnsen, the group’s Founder and Chief Investment Officer. Bahnsen.” And conversely, asset price inflation (the increase in stock prices or house prices) has a positive impact on high-income families more than on low-income families, because they are the households that own more expensive assets and homes,” he says further.
Christos Makridis and Clare Jace of the University of Arizona found marital commitment to be a stabilizing and comforting factor during declining work-related incomes and economic lockdowns from Covid-19. Their research supports the argument that marital commitments tend to be strengthened during tough economic times. “Using individual data from the recent Census Bureau Pulse Survey, we show that married respondents are not only less likely to experience mental health problems, but also less likely to experience these problems following a decline in work-related income. they wrote.
While economists continue to debate the effect of inflation on divorce rates, many couples seem more concerned with simply trying to keep their pantry stocked.