- The economic “specialization” of marriage...becomes more likely to happen to cohabiters as well, as cohabitation becomes legally more similar to marriage. Tweet This
- Canada’s legal changes to cohabitation ... amounted to telling people that long-term no-strings cohabitation simply isn’t allowed, or at least is no longer the default in the absence of a cohabitation agreement. Tweet This
Here in the United States, there aren’t a whole lot of legal rights that go along with cohabitation. “Common-law marriages” are a thing of the past outside a handful of states, and generally require more than simply living together to establish anyhow.
Up in Canada, things are apparently quite different, as a new study from Marion Goussé and Marion Leturcq details. After one year, cohabitation is considered a legal status under Canadian law and is reported on tax returns. Cohabiters are eligible for their partners’ car insurance and pension plans. And between 1972 and 1999, every province except Quebec enacted laws allowing some cohabiters to claim alimony after a break-up. Three provinces have taken a further step, considering cohabiting relationships to be equal to marriages after a certain period of time, including when it comes to dividing up property after a breakup.
The study uses the Canadian setting to answer an important question: When the alimony and property-division rules change, do couples change their behavior in response? And how?
After all, this gradually changing legal landscape amounts to a whole lot of “natural experiments” run simultaneously. Since these changes went into effect in different places and at different times, the authors can check to see if couples’ behavior changed in a similar pattern. And to add another layer of complexity, different couples were affected differently even when they lived in the same place: Those already cohabiting were “caught” by the changes—with new legal rules imposed on a relationship that had been formed under the old ones—while others could modify their plans in advance, or even decide not to cohabit at all.
Here’s how the authors summarize their own results, which, owing to the above-noted layers of complexity, are scattered through various statistical models testing different types of couples’ reactions to different changes: “[E]ligibility for a more protective regime increases men’s labour supply and earnings and decreases . . . women’s. The impact of the marriage-like regime is stronger, especially for women.”
Basically, the economic “specialization” we often see within marriage—where one partner, typically the man, works more while the other partner does more at home—becomes more likely to happen to cohabiters as well, as cohabitation becomes legally more similar to marriage. Stepping back from work can damage one’s future earning prospects, a risk that’s easier to take when the law guarantees you’ll be taken care of in the event of a breakup.
To put more specific numbers on it, cohabiting men worked 271 more hours per year when the “alimony regime” went into effect, while cohabiting women became 7.7 percentage points more likely to be unemployed or inactive. When the “marriage regime” replaced the alimony regime, women became another 4.4 points more likely to be inactive or unemployed.
Interestingly, these impacts were concentrated among couples who were already cohabiting and thus “caught” by the changes. They were also concentrated among couples where the woman already earned less than 40% of the couple’s income.
On top of that, cohabitation became more stable in the marriage regime, with cohabiting couples less likely to break up or formally get married. Couples also became less likely to cohabit, rather than marrying outright, to begin with. “Our results indicate that the increase in the level of protection at separation for cohabitants has decreased the attractiveness of this contract,” the authors write. “Couples who still decide to choose cohabitation have higher preferences for this contract and are better matched as they anticipate higher costs of separation.”
There are a few key takeaways here.
First, this reinforces the finding of a different study I discussed in this space: Marriage—and marriage-like protections—turns wealth into collateral. When spouses or cohabiters know they are entitled to money in the event the relationship goes south, that frees them up to make decisions that would otherwise be much riskier.
Second, those decisions do not tend to make the sexes more equal in the workplace, so if these reforms were intended to promote gender equity, they failed. As the study’s authors put it, eligibility for these reforms changes behavior in a way that “reinforces existing inequality” and “may offset additional protection upon separation by increasing women’s dependence on their partner.”
And third, the options the government makes available to people after a breakup are extremely powerful, and it’s worth debating what the defaults should be for cohabiters, especially as cohabitation becomes much more common. While Canada’s changes elevated the legal status of cohabitation, they were socially conservative in a weird way: Not only did they have the practical effects of making cohabitation less attractive and helping couples to specialize economically—which often takes the form of traditional gender roles—but they amounted to telling people that long-term, no-strings cohabitation, free of legal obligations, simply isn’t allowed, or at least is no longer the default in the absence of a cohabitation agreement. Those of us who are deeply concerned about the instability of cohabitation (including in Canada specifically), and also about the watering-down of the special status of marriage, might have some uncomfortable tradeoffs to make here.
In this study, Goussé and Leturcq provide an interesting window into Canadian law and human relationships. Their work also has real policy implications—which depend on what you happen to think the purpose of government marriage policy is.
Robert VerBruggen is an IFS research fellow and a fellow at the Manhattan Institute.