The Philosophy of Family Law: An Economic Approach

Marriage and making a family is one of the most important non-market choices in every person’s life cycle with its own particular economic, social and even political effects. This choice is being made within a framework of both formal and informal institutions. By institution, we mean the rules of the game. This paper purports to apply “Family Economics” and “Economic Analysis of Law” to investigate the philosophy of family law from an economic perspective. From this approach, marriage is a long-run contract with obligations for spouses the enforcement of which brings benefits to the parties. These benefits heavily depend on the investment of the parties in the marriage that itself is associated with costs and risks. Indeed, there is an asymmetry of costs of investments and risks of utilizing of benefits over the time for the wife and the husband. This might lead to opportunistic behavior from the husband, specifically at the early years of marriage. From the economic perspective, the most important function of family law (which appears in divorce law) is to manage and cover this risk for the wife and deter the husband from opportunistic behavior.