Plant Closure and Marital Dissolution

Abstract

Abstract:\nWe estimate the effect of plant closure on divorce using a panel data set comprising more than\n80,000 married couples in Norway. Plant closure substantially increases the likelihood of marital\ndissolution of workers in affected plants. The marriages of husbands originally employed in plants\nthat closed between 1995 and 2000 were 11 percent more likely to be dissolved by 2003 than\ncomparable marriages of husbands in stable plants. Additional analyses suggest that the effect of\nplant closure on divorce is not due to unexpected reduction in earnings. The results are, however,\nconsistent with role theories, in which the husband’s attractiveness declines if he fails to fulfill a\ntraditional role as a breadwinner.\nKeywords: marital dissolution, divorce, new information, shock, plant closure, plant downsizing,\ndisplacement

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