Divorce law reforms and divorce rates in the USA: An interactive fixed-effects approach

Dukpa Kim, Tatsushi Oka

Research output: Contribution to journalArticlepeer-review

32 Citations (Scopus)


SUMMARY: This paper estimates the effects of unilateral divorce laws on divorce rates in the USA from a panel of state-level divorce rates. We use the interactive fixed-effects model to address the issue of endogeneity due to the association between cross-state unobserved heterogeneity and divorce law reforms. We document that earlier studies in the literature do not fully control for unobserved heterogeneity and result in mixed empirical evidence on the effects of divorce law reforms. While reconciling these conflicting results, our results suggest that divorce law reforms have temporal positive effects on divorce rates, thus confirming the 2006 findings of Wolfers. Via simulation experiments, we assess the degree to which faulty inclusion or faulty exclusion of interactive fixed effects affects the policy effect estimators. Our results suggest that faulty inclusion only results in efficiency loss whereas faulty exclusion causes bias.

Original languageEnglish
Pages (from-to)231-245
Number of pages15
JournalJournal of Applied Econometrics
Issue number2
Publication statusPublished - 2014 Mar
Externally publishedYes

ASJC Scopus subject areas

  • Social Sciences (miscellaneous)
  • Economics and Econometrics


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