The United States personal income tax system treats married and unmarried couples differently, creating both penalties and subsidies for marriage. This paper examines the effect of these penalties and subsidies on the choice of marital status. Endogeneity between the marriage penalty a couple faces and its marital status is dealt with using a simulated instrument capturing variation in the tax code over time and between states. I find that a $1,000 change in the financial incentive for marriage has a 1.7 percentage point (1.9 per cent) effect on the probability of marriage. This effect is symmetric for subsidies and penalties and, whilst modest, is four times larger than previously estimated. Lower education groups and couples without children are the most responsive.

This paper shows that divorce in the UK has different consequences for high and for low income households, and for men and for women. The opportunity to mitigate these consequences and to recover also differs across groups. Women in the highest income households before divorce suffer the largest and most persistent falls in their standard of living compared to those from the lowest income households, who recover quickly.Men increase their standard of living on divorce: low income men recover the most and recover fastest, partly driven by returning to live with their extended families. Across the income distribution, there is no evidence that women are more likely to remain in the marital home than men after divorce, with the majority of men and women moving house on divorce.

In raw data in the UK, the income loss on separation for women who were cohabiting is less than the loss for those who were married. Cohabitees lose less even after matching on observable characteristics including age and children. This di¤erence is not explained by di¤erences in access to bene…ts or labour supply responses after separation. We show that the di¤erence arises because of di¤erences in access to family support networks: cohabitees'household income falls by less because they are more likely to live with other adults, particularly their family, following separation, even after matching on age and children.Divorced women do not return to living with their extended families. The greater legal protection o¤ered by marriage does not appear to translate into economic protection.

Paid parental leave is an important part of family policy in OECD countries. Australia's Paid Parental Leave scheme was introduced in 2011 and provides 18 weeks of leave paid at the full‐time minimum wage for the primary carer of a child. We estimate the effect of access to paid parental leave on women's fertility intentions by exploiting the differential impact of the scheme for women working in the public and private sectors. We find that the scheme's announcement had no impact on fertility intentions at the extensive margin but that, conditional on intending to have at least one (more) child, the number of children intended increases by 0.34, a 16 per cent increase. This effect is concentrated among highly educated women. As it has been shown that fertility intentions predict fertility outcomes, these results suggest that even modest paid parental leave programs can increase the fertility of working women and so moderate the declines in fertility rates seen in many developed countries.

This article examines how a reduction in the financial resources available to lone parents affects repartnering. We exploit an Australian natural experiment that reduced the financial resources available to a subset of separating parents. Using biweekly administrative data capturing separations occurring among low- and middle- income couples, we show that the policy reform significantly increased the speed of repartnering for affected separating mothers. The results demonstrate that one way that lone mothers respond to a reduction in financial resources available at the time of relationship breakdown is by repartnering more quickly.