Divorce, Abortion and Sex Ratio at Birth: The Effect of the Amended Divorce Law in China

This paper explores whether and to what extent the relative circumstances of men and women following marital dissolution affect sex selection behavior within marriages. China’s new divorce law, which was enacted in 2001, reduced divorce costs, especially for women, by granting the right to divorce and claim damages in the case of domestic violence and extramarital relationships and by securing women’s property rights upon divorce. We model the legal change as a decrease in women’s divorce costs in a household in which the spouses have non transferable utility and all the marital surplus accrues to the husband. We show that the new law results in fewer sex-selective abortions for the second birth if the first birth produced a daughter, and that the sex ratio should decline the most in historically low divorce regions. Both predictions are consistent with the empirical evidence, and the spatial variations in the decline of sex ratio helps rule out concomitant changes in household income and relative returns to male and female children. With a Difference-In-Difference approach, we also find that women with a later first pregnancy, which increases the health-related costs of performing sex selective abortions, are more responsive to the divorce law change. In addition, we perform an exercise of "timing regression discontinuity" to separate the effect of divorce law from other policy changes, examine the outcomes of induced abortions and birth spacing to address the concern of underreporting female birth, and explore the changes in household consumption, which show a pattern consistent with the increase in women’s position within households

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Ang Sun