232 EALR, V. 9, nº 2, p. 232-258, Maio-Ago, 2018
Economic Analysis of Law Review
Why do Most People Follow the Default Matrimonial Property
Regime in Chile?
Por que a maioria das pessoas segue o regime de propriedade matrimonial padrão no Chile? Omar Vásquez Duque 1
Stanford Law School
RESUMO
Os cônjuges no Chile têm três opções diferentes de regimes de propriedade matrimonial para regular suas relações pecuniárias entre si e com terceiros: parceria conjugal, separação de bens e comuni-dade de ganhos. O regime padrão é a parceria con-jugal, e a maioria das pessoas concorda com isso no momento do casamento. Os cônjuges podem, no entanto, desistir antes e depois do casamento com qualquer uma das duas outras alternativas. Levando em consideração os dados de 2006 a 2014, em média, 55% dos cônjuges acompanha-ram o regime de inadimplência. A prevalência da parceria conjugal ocorre apesar do aumento das taxas de divórcio, a natureza discriminatória do regime em relação às mulheres e uma taxa signifi-cativa de ex-post-outs. Os precedentes duvidam das razões pelas quais as pessoas - e particular-mente as mulheres - podem preferir a parceria conjugal. Este estudo tenta determinar: (i) se o re-gime padrão impõe um imposto emocional sobre os cônjuges ou prevalece por causa da inércia; (ii) o impacto das normas sociais na tomada de deci-são das pessoas; (iii) percepções errôneas sobre as taxas de divórcio; (iv) viés de otimismo; e (v) co-nhecimento das restrições atuais que as mulheres enfrentam no âmbito da parceria conjugal. Final-mente, este estudo avaliou (vi) se as pessoas acham aceitável mudar a regra padrão para a se-paração de propriedade. Com este propósito, eu entrevistei pessoas casadas no Chile com a ajuda das mídias sociais. Os resultados mostraram que o
ABSTRACT
Spouses in Chile have three different choices of matrimonial property regimes to regulate their pe-cuniary relationships among themselves and with third parties: marital partnership, separation of goods, and community of gains. The default re-gime is the marital partnership, and most people go along with it at the moment of marriage. Spouses can, however, opt out before and after the marriage to any of the two other alternatives. Tak-ing into consideration data from 2006 to 2014, on average, 55% of spouses went along with the de-fault regime. The prevalence of marital partner-ship occurs despite the increase in divorce rates, the discriminatory nature of the regime towards women, and a significant rate of ex-post opt-outs. The preceding sheds doubt on the reasons why people—and particularly women—might prefer the marital partnership. This study attempts to de-termine: (i) whether the default regime imposes an emotional tax on spouses or prevails because of inertia; (ii) the impact of social norms in people’s decision making; (iii) misperceptions about di-vorce rates; (iv) optimism bias; and (v) knowledge of current restrictions women face under the mar-ital partnership. Finally, this study assessed (vi) whether people would find it acceptable to switch the default rule to separation of property. With this purpose, I surveyed married people in Chile with the help of social media. The findings showed that the default did not impose an emotional bur-den for most people who decided to stick to it.
1E-mail: [email protected]
LL.B. Law and Social Sciences, Universidad de Chile Law School. LL.M. Harvard Law School. J.S.M. Stanford Law School and J.S.D. Candidate, Stanford Law School. I am grateful to Professor Cass R. Sunstein, who supervised this work, which I wrote for his class Behavioral Economics, Law, and Public Policy in 2016 during my LL.M. at Harvard. I received helpful comments from Professors Reinier Kraakman and Oren Bar-Gill, as well as from Jorge Cortés-Monroy and Carlos Vásquez Duque. María Paz Gatica helped me distributing the questionnaire. I first heard this research question from my mentor Santiago Montt Oyarzún but he did not develop it.
padrão não impôs um fardo emocional para a mai-oria das pessoas que decidiram se ater a ele. En-quanto a inércia e o comportamento do rebanho podem ter influenciado 33% das pessoas que con-cordaram com a inadimplência, a ignorância sobre as reais taxas de divórcio, otimismo e desconheci-mento sobre as restrições impostas à parceria con-jugal proporcionaram uma explicação melhor so-bre a alta taxa de cônjuges. preso à parceria conju-gal. À luz das taxas atuais de divórcio, esse é um resultado abaixo do ideal. Campanhas informati-vas devem superar essa falha. Além disso, mudar a regra padrão seria um estímulo positivo para ajudar as pessoas a tomar melhores decisões.
While inertia and herd behavior might have influ-enced 33% of people who went along with the de-fault, ignorance about the actual divorce rates, op-timism, and unawareness about the restrictions the marital partnership imposes on women pro-vided a better explanation on the high rate of spouses that stuck to the marital partnership. In light of current divorce rates, this is a sub-optimal outcome. Informational campaigns should over-come this failure. Also, switching the default rule would be a positive nudge to help people make better decisions.
Palavras-chave: Keywords:
JEL: K21, L49 R: 29/08/2017 A: 15/10/2017 P: 30/9/2018
1. Introduction
Can. 1055 §1 The marriage covenant, by which a man and a woman establish between them-selves a partnership of their whole life, and which of its own very nature is ordered to the well-being
of the spouses and to the procreation and upbringing of children … Can. 1056 The essential properties of marriage are unity and indissolubility …2
arital partnership—or a variation that involves either general or restricted communal ownership of goods acquired during the marriage—prevails as the default model for matrimonial property regime (MPR) in most civil law ju-risdictions.3 This is despite current high divorce rates and the evolution of family
mod-els towards more independent paradigms.
The partnership model—as well as communitarian models, but to a different degree—represents the unity or community of interests within the marriage, conceived as a common enterprise. However, the models on which the marital partnership is based conceived of marriage not as a mere unity or community of interests such as other kinds of associations, but as a lifetime project in which the wife was subordinated to the husband. This model stems from the influence of Roman Law, the Latin-Catholic
2 Code of Canon Law. BOOK IV: THE SANCTIFYING OFFICE OF THE CHURCH (Cann. 834 – 848).
PART I: THE SACRAMENTS. TITLE VII: MARRIAGE (Cann. 1055 - 1165). Available at: http://www.vatican.va/archive/ENG1104/_P3V.HTM
3 For instance, Italy (art. 159 Civil Code), Spain (art. 1,333 Civil Code) determines this regime as the default rule for all those states that do not specify a different rule (some do, as Cataluña and Valencia, which set separation of property as the default), France (art. 1,387 Civil Code), Portugal (art. 1,717 Civil Code), Belgium (art. 1398), Chile (art. 1,718), Brazil (art. 1640 Civil Code).
family model, Germanic law, and, ultimately, the French Civil Code,4 which had an
im-portant influence in Europe and Latin America.5
The perception of marriage has changed. Though some legal definitions—heav-ily influenced by canon law—still conceive marriage as an indissoluble lifetime project,6
divorce is a possibility in almost every legal system in the world. Nowadays, a non-negligible percentage of couples decide to divorce when the relationship does not work and in most western societies divorce does not carry a negative social connotation at all. Indeed, divorce rates are significant in most western countries.7
According to the statistics of the European Commission, in 2013 Spain, Luxem-bourg, Denmark, the Czech Republic and Portugal showed divorce to marriage ratios higher than 60 to 100—that is, for each 100 marriages a year, there were 60 divorces.8
That same year, Hungary, Sweden, and Finland reported a ratio slightly higher than 50 to 100.9 In the U.S.—where separation of property tends to be the default MPR in most
states—the data shows a ratio of approximately 50 to 100, and studies indicate more generally that the probability of divorce is close to 50% for first marriages and slightly higher for second marriages.10
Furthermore, today’s conception of marriage does not rely on the traditional distribution of roles within the family—that is, a male breadwinner, and a housewife— but on an equal union with a more flexible division of roles and equal value of labor and aspirations inside and outside the home.11 In western countries employment rates
4 André Tunc, “Husband and Wife under French Law: Past, Present, Future,” University of Pennsylva-nia Law Review 104, no. 8 (1956): 1064–79. “In France under the ancien régime, the family had been
centred upon the husband, whose strong authority and powers were inherited from the Roman paterfa-milias (head of family) tradition. Although the Revolution proclaimed women to be equal in rights with men, it did little to implement this view in law. The drafters of the code saw no reason to modify the traditional situation, and Napoleon himself favoured subordination of the wife to the husband. The code expressly stated that she owed him obedience. With very few exceptions, she had no legal capacity to act. Without the written consent of her husband, she could not sell, give, mortgage, buy, or even receive property through donation or succession.” “Civil Law | Romano-Germanic,” Encyclopedia Britannica. Germanic family law has had persistently a more equalitarian view about both spouses, so as Nordic and Anglo Saxon models. See e.g., Branka Rešetar, “Matrimonial Property in Europe: A Link between Soci-ology and Family Law,” ELEC. J. COMP. L. 12 (2008): 1–10.
5 M. C. Mirow, Borrowing Private Law in Latin America: Andrés Bello’s Use of the Code Napoléon in Drafting the Chilean Civil Code, Rochester, NY, SSRN Scholarly Paper ID 1586836 (Social Science
Re-search Network, 2001).
6 For example, Art. 102 Civil Code Chile: “Matrimony is a solemn contract through which one man and
one woman unite presently and indissolubly for all life, in order to live together, to procreate and to mutually assist each other”.
7 “Eurostat - Divorce Indicators.”
8 61.8, 67.5, 68.8, 64.1, and 70.4, respectively. See Ibid.
9 Ibid. Hungary: 54.6, Finland: 54.8, Sweden: 52.2, and The Netherlands: 52.1. Germany reported a
slightly lower ratio for 2013: 45.5. France reported a ratio of 56.1 in 2011, and there is no data for more recent years.
10 U.S. Department of Labor Bureau of Labor Statistics, “Marriage and Divorce: Patterns by Gender,
Race, and Educational Attainment,” October 2013. Recall that the divorce to marriage ratio reports a measure based on two different populations, hence it is not a good proxy for the assessment of proba-bilities. However, there are studies that have measured the number of marriages that took place in cer-tain decades in the U.S. and compared the total number of marriages via-à-vis the number of divorces for the same particular group. The results vary slightly depending in the decade in which the marriage took place. See Claire Cain Miller, “The Divorce Surge Is Over, but the Myth Lives On,” The New York
Times, December 2, 2014.
are still lower for women than for men, but the gap has decreased significantly in recent years. In the European Union, 59.6% of women were employed in 2014, versus 70.01% of men.12 In the U.S. the statistics are similar. According to the Woman’s Bureau of the
U.S. Department of Labor, 57% of woman were employed in 2014, compared to 69.2% of men.13 The high levels of female employment defy the concept of family that inspired
the marital partnership.
The reality in Chile is not an exception among civil law countries. The original version of the Civil Code considered marital partnership as the only MPR available for spouses. Yet, since 1925 the Code also offers the possibility to opt-out to separation of property. Since 1994 spouses can also opt-out to a community of gains regime. Con-cerning divorce rates in Chile, the average divorce to marriage ratio from 2006 to 2014 was of 0.63—that is, there were 63 divorces per 100 marriages. Nonetheless, with re-spect to independence and equality the Chilean reality is a particular case, one that has been criticized both at national and international levels.14 Based on the post-revolution
French Code, the original version of the Chilean Civil Code considered the husband as “the boss” of the marital partnership, and not only prevented the wife from adminis-tering the partnership, but also her own property. Almost 170 years later, this model is still in force—despite ancillary amendments, which will be discussed in the next sec-tion.
Behavioral law and economics is an unexplored discipline in Chile. This is the first attempt to assess the impact of a default rule in Chilean legal scholarship. Marital partnership is a relevant institution to begin with for three main reasons. First, it is the most vivid example of a default rule in the Chilean legal system, and a recent article suggested that the 55% of people marrying under marital partnership did so because it is the default rule. However, there is no empirical evidence for that statement.15 The
analysis here, however, will include further hypotheses related to the behavioral eco-nomics framework: influence of social norms, optimism, and misperceptions about the law. Second, the rise of divorce rates causes a serious concern regarding the costs of the dissolution and liquidation of marital partnerships. In addition, the high rate of ex-post opt-outs yields similar costs to divorce proceedings since the dissolution and liq-uidation of the partnership is equally required. Third, the current default rule has been widely criticized for being discriminatory against woman. The current rate of people going along with the default MPR may signal that people are not aware of the re-strictions the marital partnership imposes on women.
12 http://ec.europa.eu/eurostat/statistics-explained/index.php/Employment_statistics 13 U.S. Department of Labor. http://www.dol.gov/wb/stats/latest_annual_data.htm#labor
14 See, María Paz Gatica R., “El Destino de La Sociedad Conyugal,” Anuario de Derechos Humanos, 2011,
169–78. At the international level: settlement between the State of Chile and Sonia Arce Esparza con Chile, October 18, 2005, case N° 12.433 before the Inter-American Commission of Human Rights, in which Chile promised to amend the laws in order to desist discrimination against woman. See also Equality Now, noting that in Chile, despite the constitutional protection of equality for every person, husbands head the household and control marital property, as well as property owned by their wives. “The Civil Code | Equality Now.”
This article presents findings from an online survey with questions adapted from Mahar´s study on prenuptial agreements.16 The survey aimed to determine: (i)
whether the decision to go along with the default MPR stemmed from an emotional tax the default may impose on people, lack of attention, or a deliberative choice; (ii) the impact of social norms in people’s decision making; (iii) misperceptions about divorce rates; (iv) optimism bias; and (v) knowledge of current restrictions women face under the marital partnership. In addition, the survey sought to ascertain (vi) whether people would find it acceptable to switch the default rule to separation of property. The results are summarized below.
Finding 1. The default MPR was often actively chosen by most respondents. Two
thirds of those surveyed reported they did discuss with their spouses which MPR was a better decision for them before the marriage. However, a third of respondents just went along with the default without deliberation. Though some respondents of this subgroup indicated that proposing to opt-out might have been perceived as a signal of distrust, they most often indicated that the choice of an MPR was not important. It is worth noting that most of the respondents from this subgroup had no college educa-tion.
Finding2. There was a strong correlation between the MPR the respondents
perceived most of their relatives and close friends chose and the MPR they chose. This finding is prevalent among the respondents who married under marital partnership and separation of property regimes. Finding 3. The respondents frequently ignored actual divorce rates. There was a general underestimation of divorce rates given the divorce to marriage ratio. In sharp contrast, there was a general and significant
over-estimation of the crude divorce ratio. A caveat is in order: In this article I use the
di-vorce to marriage ratio as an indicator of didi-vorces. But this is an imperfect proxy for it compares two unlike populations: married and divorced people. The crude divorce ra-tio is also imperfect. It indicates the number of divorces per 1,000 people, including population unable to marry, such as infants.17 It is certainly beyond the scope of this
paper to assess diverse statistics. However, this article does assess people’s mispercep-tions about them, finding considerable differences in the magnitude and direction of people’s misperceptions about each statistic. This result should be taken into account when governments decide which statistic to disclose.
Finding 4. Considering the divorce to marriage ratio as a proxy of the
probabil-ity of divorce, people reported their particular likelihood of divorce as lower than aver-age. This finding of optimism is consistent with prior studies18 and might partially
ex-plain why the choice of an MPR is not salient for a segment of the population. Lawyers are as optimistic as non-lawyers. Interestingly, people who had previously divorced reported a more accurate probability of divorce and lower optimism. Finding 5. More than 40% of respondents who married under marital partnership did not know the limitations women face concerning the administration of their own goods. This is a
16 Heather Mahar, “Why Are There so Few Prenuptial Agreements?,” Harvard Law School John M. Olin Center for Law, Economics and Business Discussion Paper Series, 2003, 436.
17 See J. Lynn England and Phillip R. Kunz, “The Application of Age-Specific Rates to Divorce,” Journal of Marriage and Family 37, no. 1 (1975): 40–46.
particular important finding. The current default MPR in Chile discriminates against women. This led to a dispute before the Inter American Commission of Human Rights, which ended in a settlement according to which the Chilean government is obliged to amend the administration rules that govern the marital partnership system.19 Before
such reform takes place the government may well inform spouses regarding this re-striction so that they can take into account this feature before deciding which MPR is a better fit for them. Finding 6. Most respondents who went along with the default would choose to marry under separation of property if their likelihood of divorce was 50%. While it is not feasible to determine a probability distribution of the respondents’ probability of divorce, it is likely that optimism led some of them to choose the wrong MPR. Finding 7. Most people found it acceptable to switch the default rule to separa-tion of property. If the default rule has an impact on a subgroup of people, it seems desirable to nudge spouses towards the MPR that fits better the modern family model and minimizes the costs of divorce. A second caveat is also necessary: the conclusions of this work are not representative of the Chilean population. Nonetheless they offer interesting findings to corroborate in future research and inform future legal reforms. This article is structured as follows: Section I contextualizes this study, giving a brief overview of the general behavioral economics framework that serves as the basis for this analysis. Section II refers to the general context of the reality in Chile. It briefly describes the three MPR available for spouses in Chile and presents the statistics con-cerning the choice of MPRs, as well divorce rate trends. Section III describes the meth-odology of this study. Section IV reports the findings. Section V discusses the results, and Section VI concludes suggesting legal policy recommendations.
2. Default rules, heard behavior, optimism, and matrimonial
property regimes
Family is an institution that maintains itself through non-legal sanctions rather than legal enforcement.20 Although most internal relationships of the family do not
re-quire legal intervention to be solved, there is a notable exception: divorce, especially the distribution of assets and liabilities arising from it. The main objective of MPRs is to regulate those relationships both within the couple itself and among the spouses and third parties. MPRs are complex features ancillary to the marriage contract. They set
19 In 2007 Ms. Sonia Arce sued the Chilean State before the Inter-American Commission of Human Rights claiming the Chilean State was depriving her of her human right of equality before the law. Ms. Arce wanted to sell real estate she had inherited, but she could not do it before asking for her husband’s authorization in advance. The problem was that her husband was lost. Thus, she had no means to obtain his assent, and was obliged to ask for judicial authorization, which, in her view, infringed upon her hu-man rights. As a response to this claim, the Chilean State settled, promising to amend the rules of marital partnership. An unfulfilled promised thus far. ACUERDO DE SOLUCIÓN AMISTOSA. Caso Nº 12.433 Sonia Arce Esparza v. Chile. See Gatica R., “El Destino de La Sociedad Conyugal.”
20 Eric A. Posner, Law and Social Norms (Cambridge, Mass.; London: Harvard University Press, 2002),
the most important rules governing the ownership of goods, their administration dur-ing the marriage and their distribution in case of divorce.
Spouses need to choose an MPR to regulate their internal and external pecuni-ary relationships. The law-maker can either designate a default MPR or require spouses to actively choose.21 This section provides the general analytical framework for
a study of how legal and social context can affect people’s choices concerning MPRs. Accordingly, this section refers to the impact of default rules, herd behavior, and opti-mism, all of which can have a role in determining which MPR people choose.
Behavioral law and economics literature has documented that default rules in-fluence people’s choices. There are several explanations for the stickiness of default rules, but the most common are the power of inertia,22 the endorsement effect,23 and
loss aversion.24 Regarding inertia, experts indicate that “[f]or lots of reasons, people
have a more general tendency to stick with their current situation.”25 This phenomenon
is called “status quo bias,”26 and one of its causes is lack of attention.27 Mindless
choos-ing implies that when facchoos-ing a choice many people might just follow the “yeah, what-ever heuristic” and stick to the default.28 When choices are difficult, complicated or
time consuming, the impact of inertia is amplified.29 In addition, people might have a
preference, but opting-out can be costly. This “effort tax” is another explanation for the status quo bias. Sticking to the default can also be a consequence of reflective
indiffer-ence.30 People might not have a defined preference, and focusing on the default as well
as forming a preference can be costly activities.31 Thus, people might follow the default
to minimize burdens and costs. This case is similar to inertia, but it does not involve inertia as such.32
Default rules may also signal a good choice, or an implicit recommendation. When choices are complex, and people trust the choice architect, choosers have good reasons to stick to the default. As Professor Cass R. Sunstein puts it “[m]any people
21 Among European and Latin American countries, the only jurisdiction that requires active choosing is
Mexico (Article 178 Federal Civil Code). In all other cases the legislator determines a specific MPR as the default.
22 Cass R. Sunstein, “Deciding by Default,” U. Pa. L. Rev. 162 (2013): 17.
23 Ibid. at 20. (“The second factor involves what people might see as an “implicit endorsement” of the default rule. If choice architects have explicitly chosen that rule, people may believe that they have been given an implicit recommendation, and that they should not depart from it unless they have private information that would justify a change.”). Citation omitted.
24 Ibid. at 21.
25 Richard H. Thaler and Cass R. Sunstein, Nudge (Yale University Press, 2008), 43.
26 William Samuelson and Richard Zeckhauser, “Status Quo Bias in Decision Making,” Journal of Risk and Uncertainty 1, no. 1 (1988): 7–59.
27 Thaler and Sunstein, Nudge, 35.
28 Sunstein, “Deciding by Default,” 19; Thaler and Sunstein, Nudge, 34–35.
29 Sunstein, “Deciding by Default,” 18. Some people treat complexity as another source of inertia. See Cass R. Sunstein, Choosing Not to Choose: Understanding the Value of Choice (Oxford University Press, 2015), 37. (“…complexity has sometimes been treated as an independent reason for the power of de-faults, though it might be more properly treated as an amplifier of inertia, or an increase in the “effort tax”.”). Citation omitted.
30 Sunstein, “Deciding by Default,” 25. 31 Ibid. at 19.
appear to think that the default was chosen by someone sensible and for a good reason. Especially if they lack experience or expertise, they might simply defer to what has been chosen for them.”33 In this case, defaults have an informational value that enhances
their stickiness. And people might think that they should not follow their own way un-less they have reliable private information that justifies opting-out of the default.34 In
addition, when people do not have a defined preference default rules set the reference points, defining the frames of gains and losses.35 However, this is beyond the scope of
this study.
When default rules have an impact on people’s preferences, the law-maker acts as a social architect, providing the context that influences choices and preferences.36
“Much behavioral work suggests that preferences and values are sometimes con-structed rather than elicited by social situation.”37 Nonetheless, people may well have
defined preferences. When people have a clear preference, such preference can over-come inertia, dismiss the informational signal of the default rule, and set the frames of gains and losses.38 If the default rule sticks because it coincides with people’s
prefer-ences, there is a case of deliberative defaulting.39 In this case people stick to the default
rule because such choice is what people really want. The default accurately identifies what people would choose had they been obliged to choose. If the default rule differs to people’s preferences, they are more likely to opt-out.40
If people do not know what to do in case of a choice that involves risk, they might well follow what other people do. Indeed, when people do not know how likely an event is, the views of trusted others can signal what a good decision looks like. As Professors Thaler and Sunstein put it, “[i]f many people do something or think something, their actions and their thoughts convey information about what might be best for you to do or think.”41
Furthermore, when people face risks they tend to think they are above average.42
“Unrealistic optimism is a pervasive feature of human life”43 and divorce is no
excep-tion. Studies indicate that people systematically underestimate their probability of di-vorce—even specialized lawyers and people who have already divorced.44 If spouses
33 Ibid. at 20.
34 Sunstein, Choosing Not to Choose, 40.
35 Daniel Kahneman and Amos Tversky, “Prospect Theory: An Analysis of Decision under Risk,” Econo-metrica 47, no. 2 (1979): 263–91.
36 Sunstein, “Deciding by Default,” 5.
37 Cass R. Sunstein, “Behavioral Analysis of Law,” The University of Chicago Law Review 64, no. 4
(Oc-tober 1, 1997): 1176.
38 Sunstein, “Deciding by Default,” 26. 39 Ibid. at 25.
40 Ibid. Professor Sunstein provides the example of marital surnames in the U.S. While the default rule
in all states is that both spouses keep their own surnames after marriage, women tend to change their surname to their husbands’ surname (approximately 80% for college graduates).
41 Thaler and Sunstein, Nudge, 54. 42 Ibid. at 31.
43 Ibid. at 33. 44 Ibid. at 32.
perceive their probability of divorce to be lower than average, divorce will be less sali-ent for them at the momsali-ent they choose an MPR.
In light of the foregoing one might raise a legitimate question: do people have a defined preference about MPRs? The data shows that in Chile at least 46% of spouses do. Indeed, 46% of spouses opt-out from the marital partnership default choosing ei-ther separation of property or community of gains. But the answer is not clear concern-ing the 54% that stick to the default. Is this a case of deliberative defaultconcern-ing, in which people stick to the default because it is what they really want? The non-negligible rate of opt-outs after marriage sheds doubt on this. Perhaps this is a consequence of inertia. People can disregard this contract feature when they marry. Yet, marriage is a “con-tract” that entails a high level of involvement, and the matrimonial property regime is one of the most important features of the contract.
Given the high stakes involved, one might think spouses should deliberate about the MPR that fits them best. Nonetheless, there might be obstacles for such delibera-tion to take place, and further obstacles for that hypothetical deliberadelibera-tion to coincide with what standard economic thinking would predict. The nature of marriage might discourage spouses to talk about the MPR before marrying. And when the default rule is a communitarian regime, raising the possibility of opting-out may entail an “emo-tional tax” (a kind of “effort tax”). In addition, MPRs are multidimensional and com-plex. Accordingly, forming a preference can be costly, particularly for people without a legal background. Regarding the outcomes of the deliberative process, a rational deci-sion-maker would collect a fair amount of information, and compare the costs and ben-efits of each alternative, including an unbiased estimate of risks (including, of course, the risk of divorce). However, it is well-documented that people are optimistic about risks,45 and divorce is not an exception.46 This article will explore the impact of the
de-fault rule, social norms, and optimism in the choice of an MPR.
In the next section I briefly describe the MPRs available in Chile. This descrip-tion expects to provide a general overview in terms of ownership and administradescrip-tion of goods between the MPR available in Chile in order to deliver the context to this study. I show a non-negligible ex-ante stickiness of the default rule relying on official public data available online, and note that despite most spouses go along with the de-fault at the moment of the marriage, there is a significant opt-out trend after the mar-riage (ex-post opt-out). Subsequently, I offer a brief synopsis of divorce in Chile, show-ing how divorce rates resemble the statistics of European countries with highest di-vorce rates—contrary to the 3% the media has constantly misreported, presenting Chile as one of the countries with the lowest divorce rates.47
3. The Chilean context
45 Ibid. at 31–33.
46 Mahar, “Why Are There so Few Prenuptial Agreements?”
47 Pamela Engel et al., “MAP: Divorce Rates Around The World,” Business Insider. Reporting a
Chile has a civil law regime.48 As most civil law countries, the default MPR is the
marital partnership.49 Spouses can also opt-out, in a prenuptial agreement or during
the celebration of the marriage, to (i) separation of property, or (ii) community of gains. Most people go along with the default MPR at the moment of the marriage. Chilean official statistics indicate that between 2006 and 2014 55% of spouses stuck to the de-fault rule, 42% opted out to separation of property, and 3% opted out to community of gains. However, there is a significant and underexplored rate of ex-post opt-outs— which amounts to 9.44% of total marriages per year.
3.1. Matrimonial property regimes
3.1.1. Marital partnership
The marital partnership regime is heavily influenced by a patriarchal family model. Though the marital partnership regime has been reformed systematically trying to respond to the evolution of Chilean society, it still considers the husband as “the boss” of the marital partnership.50 This is despite women—including married women—
are fully capable since 1989 (woman generally since 1925, and married woman since 1989).51 The source of this provision is the original version of the French Civil Code,
which was in turn influenced by Roman Law, the doctrine of the Catholic Roman Church, and Germanic Law.52
48 Chile was a Spanish Colony until early XIX Century. After Independence in 1818, Chile followed the
same Spanish laws that ruled before independence. In 1855 Chile passed the Civil Code, heavily influ-enced by the French Code, Roman Law, and Spanish laws. See Charles P. Sherman, “Salient Features of the Chilean Law of Sale,” U. Pa. L. Rev. 67 (1919): 75–79.
49 See n3 for a list of countries and references to legal sources. For a brief explanation about the Chilean
system in English, see “PLC - Family Law in Chile: Overview.”
50 Article 1749. The marital partnership is to be headed by the husband, who shall administer the
spouses’ joint property as well as the property owned by his wife, subject to the obligations and limita-tions set forth in this Section and those agreed to at the time of marriage . . .
51 Gatica R., “El Destino de La Sociedad Conyugal,” 173.
52 See, Tunc, “Husband and Wife under French Law: Past, Present, Future.” In the incipiency of Roman Law, woman was conceived as fully incapable. Accordingly, she was placed under a perpetual tutorship, and marriage only changed her tutor. However, at the end of the evolution of Roman Law, woman was fully capable, and many rules were issued in order to protect woman against an abuse of influence by her husband. Despite this evolution, European law makers in the XVIII century used the first stage of Roman Law as a model to regulate their particular conception about family. The doctrine of the Catholic Roman Church, as stated by Saint Paul, considered woman was an “inferior creature”. This strong state-ment was qualified by “charity”. According to German customs, unmarried woman was fully capable, yet married woman was under her husband’s power. This incapacity, however, was instrumental to en-force the husband’s power. When he was away for a long time or deprived of his legal rights, the wife was automatically fully capable. The French Code was influenced by the revival of the study of Roman Law. The incapacity of woman was then rationalized by the “weakness” of woman as such. According to this idea, woman had no capacity to act on her own even when her husband was away for a long time or was deprived of his rights. This conception of marriage explains the original Art. 217 of the French Civil Code: “A wife, even when there is no community or in case of separation of property, cannot give, convey,
Concerning the ownership of goods, all goods but real estate the spouses had before the marriage enter the community, so as the goods they acquire during the mar-riage, excepting real estate they inherit or acquire as a gratuity. Those goods that be-come part of the partnership are communitarian goods. Those that remain part of the spouses’ private property are private goods. With respect to the administration of goods, only the husband has the right to administer the partnership. He administers not only his own goods and the communitarian goods but also his wife’s goods—subject to limitations in case of significant economic relevance.53
The foregoing is subject to an important qualification. The woman who works independently from her husband has the right to freely administer the goods she ac-quires as a result of her work.54 If the woman acquires a good as a gratuity, however,
her husband is entitled to the administration of the good. Ms. Arce’s case holds even if she had had an independent job.
3.1.2. Separation of property
Since 1925 spouses can marry under a separation of property regime. When they choose this alternative, there is no community at all, and each spouse administers his or her own goods. In case of divorce, each spouse keeps his or her own goods. If one of them worked less than he or she could and wanted because of taking care of the house-hold, the law considers a particular tort action to compensate that spouse for the eco-nomic harm he or she suffered.55
3.1.3. Community of gains
The community of gains follows a similar logic than separation of property, but in case of divorce the spouse that increased his or her assets the most has to compen-sate the other by splitting the difference of wealth that arose during the life of the mar-riage.
3.2. What spouses choose in Chile
The reality in Chile shows a moderate ex-ante stickiness of the default rule, but also a high number of ex-post opt-outs. The majority of spouses go along with the de-fault MPR at the moment of the marriage. However, based on public data for the period between 2006 and 2014, an average of 6,488 couples opted out after the marriage every year. Most of them opted out to separation of property.
3.2.1. Ex-ante stickiness of the default rule
Chilean spouses tend to stick to the default MPR at the moment of the marriage. Between 2006 and 2014, in average 55% of couples went along with the default MPR; 42% opted out to separation of property; and 3% chose the community of gains model.
mortgage, or acquire property, either with or without consideration, without her husband's joining in the instrument or his written consent”. This rule, was abolished in France itself in 1938.
53 Article 1749, Chilean Civil Code. 54 Article 150, Chilean Civil Code. 55 Article 61, New Act of Civil Marriage.
Based on data of the Chilean Civil Register
Available at: https://www.registrocivil.cl/PortalOI/PDF/Banner%20de%20genero%20Final.pdf Between 2006 and 2008, the preference of marital partnership showed a slight and constant decline; while the choice for separation for property showed a slight and constant rise. Since 2009, however, there was a steady difference of 12% in average, which favored the default MPR. Only 3% of couples chose the community of gains re-gime between 2006 and 2009, and 2% from 2010 to 2014.
Based on data of the Chilean Civil Register
Available at: https://www.registrocivil.cl/PortalOI/PDF/Banner%20de%20genero%20Final.pdf
55% 42%
3%
The Choice of Matrimonial Property Regimes
(Average from 2006-2014)
Marital Partnership Separation of Property Community of Gains
2006 2007 2008 2009 2010 2011 2012 2013 2014 Marital Partnership 0.60 0.58 0.55 0.54 0.55 0.54 0.55 0.55 0.55 Separation of Property 0.37 0.40 0.42 0.43 0.43 0.43 0.43 0.43 0.43 Community of gains 0.03 0.03 0.03 0.03 0.02 0.02 0.02 0.02 0.02 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 P er ce n tag e
The Choice of Property Regimes in Percentages
2006-2014
3.2.2. Ex post opt out
As previously indicated, spouses can opt-out from the default matrimonial property regime either before or after the marriage. While 55% of couples went along with the default MPR at the moment of the marriage, between 2006 and 2014 in av-erage 6,488 couples opted out after the marriage. Most of them switched from marital partnership to separation of property (virtually, 100%). The rate between ex-post opt-outs and marriages per year was almost 1 to 10.
Based on data of the Chilean Civil Register
Available at: https://www.registrocivil.cl/PortalOI/PDF/Banner%20de%20genero%20Final.pdf 3.3. Divorce in Chile
Official divorce in Chile is a relatively new reality. The Civil Marriage Act (also known as “Divorce Act”) was passed in 2004. After 10 years of discussion, in which the Catholic Church enthusiastically opposed to the proposals, for the first time in Chilean history the law allowed spouses to divorce “officially.” Before 2004, Chilean spouses could request the civil judge to declare the marriage void for procedural matters, alleg-ing the public official of the Civil Registry who performed the marriage had no geo-graphic jurisdiction at the time the marriage took place.56 Having no other choice,
1,500 couples filled for nullity each year.57 However, this mechanism only worked when
56 In practice, this was the mechanism spouses used to divorce when there was agreement among them.
Though everyone knew this was a sham, since 1925 this was the generally accepted artifact people took advantage of to overcome the limitations of the conservative legal system.
57 Manuel Somarriva Undurraga, “Encuesta Sobre El Divorcio y La Separación de Cuerpos En La
Socie-dad Moderna,” Anales de La Facultad de Ciencias Jurídicas y Sociales; Vol. 12, No. 44-51 (1946):
1946-1947 Primera Época, 1946, http://www.revistas.uchile.cl/index.php/ACJYS/article/view/4277/4167. 2006 2007 2008 2009 2010 2011 2012 2013 2014 ex post opt-out/marriages 12% 12% 12% 13% 11% 10% 9% 9% 9% 0% 2% 4% 6% 8% 10% 12% 14% P er ce n tag e
Ex-post opt-outs / total marriages
2006-2014
both spouses wanted “the nullity” and were willing to face the subsequent social stigma that such decision entailed.58
Between 2006 and 2014, in average 38,335 couples divorced each year. How-ever, as it is evident in the next chart, divorces rocketed after 2008 and remained rel-atively constant since then. The divorce to marriage ratio for such period shows a mean of 0.62 and a median of 0.73.
Based on data of the Chilean Civil Register
Available at: https://www.registrocivil.cl/PortalOI/PDF/Banner%20de%20genero%20Final.pdf
58 See José Miguel Jaque et al., “10 Años de La Ley de Divorcio: La Tormenta Que No Fue,” La Tercera,
May 10, 2014. Documenting how society judged the nullity before divorce was officially incorporated into the legal system.
2006 2007 2008 2009 2010 2011 2012 2013 2014 Divorces 10119 16049 22441 53555 51531 47222 48571 48272 47253 Marriages 59323 59134 57404 57404 57836 62170 66132 65290 67037 0 10000 20000 30000 40000 50000 60000 70000 80000 N u m b er o f co u p les
Marriages and Divorces in Chile
2006-2014
2006 2007 2008 2009 2010 2011 2012 2013 2014 Divorce to Marriage Ratio 0.17 0.27 0.39 0.93 0.89 0.76 0.73 0.74 0.70
0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00 R atio
Divorce to Marriage Ratio
2006-2014
Based on data of the Chilean Civil Register
Available at: https://www.registrocivil.cl/PortalOI/PDF/Banner%20de%20genero%20Final.pdf
4. The Method
I designed a survey in Typeform, an online survey resource, and distributed the questionnaire in Facebook among my contacts. No economic incentives were offered to answer the survey. Some of my friends found the study interesting and shared the questionnaire with their Facebook and Twitter contacts. In total, 388 people visited the website and 241 completed the survey (62% response rate).Yet, 16 answers were excluded: the 5 of quickest response, the 5 of slowest response, and 6 that included particularly inconsistent answers. As a result of this, the final sample included 225 valid answers.
The questionnaire started asking general demographic questions and whether the respondents were lawyers or not (to control the results given the high number of lawyers within my Facebook contacts). Then, the respondents were asked the MPR most of their relatives and friends chose, their best estimate of people that choose each MPR, the religion they most closely felt represented to, whether their parents divorced, whether they had divorced once or more times, and their best estimate of the divorce to marriage ratio and the crude divorce ratio. Afterwards, I asked which MPR they chose, their perceived probability of divorce, and which MPR they would choose in case their probability of divorce was 50%. Finally, I asked them whether they found accepta-ble to switch the default rule to separation of property. For people who married under marital partnership I included additional questions: the most relevant was whether they discussed with their spouses the MPR they preferred or just went along with the default without deliberation. For the latter, I included 5 statements intending to test whether the default rule imposed an emotional tax on spouses wishing to opt-out, or defaulting was most likely the result of inertia and/or herd behavior.
The sample is not representative of the Chilean population. Most of the ents married under separation of property (68.4%). Little more than 20% of respond-ents married under marital partnership (21,8%), and 9.8% married under community of gains. Most of respondents were women: 66.2% versus 33.8% of men. Most respond-ents were highly educated people. The majority had a graduate degree: 50.2%; 40% had a bachelor’s degree, and only 9.8% had no college education. Almost 37% of re-spondents were lawyers and 63.1% had no legal background. Concerning religion, most respondents felt most closely represented by Christianity (62.2%); 27.1% declared not being religious; 7.1% answered their religion was not indicated in the list of options; and 3.6% affirmed to feel represented by Judaism.
5. 1. The default rule did not impose an emotional tax on most respondents
Out of the 49 people who followed the default rule, 33 reported they discussed with their spouses the MPR that fitted them best before the marriage (67%) and 16 indicated they did not (33%). This is an interesting finding that qualifies the hypothesis that the default rule imposes an “emotional tax” on spouses wishing to opt-out. This result might be counterintuitive to some degree. A previous study about prenuptial agreements found that most people believed a prenuptial agreement expressed a neg-ative signal.59 And opting-out from marital partnership might send a similar signal in
that a spouse for whom the divorce is not a possibility should not care about the MPR.
This 33% that goes along with the default MPR without deliberation is mainly comprised by people without college education. Indeed, 75% of this group had no bach-elor’s degree; 6% had a bachbach-elor’s degree; and 19% had graduate studies.
The educational background not only played a role in deliberative defaulting, but also on the choice to opt-out. My sample showed a statistically significant correla-tion between the educacorrela-tional level and the choice of a specific MPR (Chi-Square Test, p < 0.01, with symmetric measures = 0.413, meaning the correlation intensity was moderate to low). With respect to opt-outs, the data showed the more educated people were, the more likely it was they would opt-out to separation of property or community of gains. In fact, 77 percent of the respondents with no college education married under marital partnership and 23 percent opted-out to separation of property. No respondent from this subgroup married under community of gains. In contrast, most of the re-spondents with college education and graduate studies opted-out—mainly to separa-tion of property (see appendix with cross tabulasepara-tion, table n1).
59 Mahar, “Why Are There so Few Prenuptial Agreements?,” 16. (“many people do believe that prenuptial
agreements send a negative signal. Specifically, 56.04% of law students and 63.70% of the general pop-ulation responded that they would believe divorce was more likely than otherwise if their fiancé(e) asked them to sign a prenuptial agreement.”). Citation omitted.
67% 33%
To test the motives why people would not deliberate, I included a particular question only for those people who married under marital partnership and did not dis-cussed which MPR fitted their marriage best. This question asked them to rank from 1 to 10 the following statements: “We did not need to talk because”: (A) marital partner-ship represents our view about marriage; (B) most people marry under marital part-nership; (C) to suggest a different MPR may signal distrust to my spouse; (D) I do not like to talk about money with my spouse; and (E) it was not important. Given that (A) seemed very appealing to justify people’s choices without thinking about it, I analyzed what respondents answered in a following question that asked whether they knew that under the rules of marital partnership the husband is the boss of the partnership and administers not only the partnership and his own goods but also his spouse’s property. If they did not know this limitation, then A would not be a convincing explanation.
The results show that people considered 4 out of 5 of those statements repre-sentative of their decision-making (the following results are summarized in a box-plot in the next paragraph). The only statement that people tended not to feel represented by was (D): “I do not like to talk about money with my spouse.” With respect to this statement, the median was 5 and there was considerable variance (most responses ranged between 1 and 7). However, for statements (A), (B), and (C), the median was close to 8 for all of them, and most responses varied between 5 and 9. Out of the 16 respondents of this subgroup, 11 did not know the limitations the marital partnership regime imposes on women. This analysis qualifies A as a credible explanation for de-faulting without deliberation. In contrast, social influence is consistent with the find-ings of section IV.3. (a high correlation between the MPR respondents chose and what their relatives and close friends chose). While the emotional tax explanation shows a median of 8, there is greater variance compared to the answers of (B) and (E). (E) is the answer that represents the respondents best since the interquartile range is be-tween 6 and 10. This suggests for most people who went along with the default without deliberation, the choice of an MPR was not important. Relating this finding with the general ignorance about divorce rates and optimism, it seems plausible to conclude that spouses did not deliberate about the MPR because divorce was not salient for them and most of their peers were married under marital partnership.
5. 2. Ignorance about divorce rates and optimism
My data clearly showed that people ignored actual divorce rates. Respondents misperceived both the actual divorce to marriage ratio and the crude divorce ratio. However, the misperception was radically different for each statistic. People
underes-timated the divorce to marriage ratio to roughly 2/3 of the actual rate (0.45 vs. 0.73).
In contrast, respondents overestimated the crude divorce ratio by a factor of 100 (300/1,000 vs. 3/1,000).60 There was no statistically significant difference among
peo-ple with different educational backgrounds. Notably, there was no difference for law-yers either, who misperceived the divorce rates equally as people without a legal back-ground.
This misperception has relevant policy implication: The crude divorce ratio sends a wrong informative signal. By itself it makes people believe that divorce is less prevalent than it really is. Though both indicators are imperfect, these results show that people perceive the divorce to marriage ratio more accurately. Thus, disclosing the actual divorce to marriage ratio should send a more informative signal to educate peo-ple about the odds of divorce.
(Mis)perceptions of divorce to marriage ratio and crude divorce ratio: Aggregate
What is your best estimate of the ratio between divorces and marriages in Chile?
What is your best estimate of the number of people that di-vorce per 1,000 population in Chile? N 225 225 Mean 44,68 276.27 Std. Deviation 21,423 195.177 Minimum 7 3 Maximum 100 800 Median 40,00 300,00
5. 2. 1. People’s perceptions about their own odds of divorce
There was considerable variance in the sample concerning how respondents perceived their own probability of divorce. Nonetheless, most of them indicated it was less likely than likely that they would divorce. Indeed, 91.3% of the sample responded their probability of divorce was lower or equal to 50%. And 72.6% responded their probability of divorce was lower or equal to 40%, the median of their perceived divorce to marriage ratio. There were some extreme responses, 53 people indicated their prob-ability of divorce was 0 and 5 people responded their probprob-ability of divorce was 100%.
Optimism was patent in the sample. For the purpose of this claim I am basing my analysis on the divorce to marriage ratio, which has been used as a proxy of the probability of divorce.61 When people were asked about their particular probability of
divorce, they tended to indicate lower probabilities than their underestimated divorce to marriage ratio. This finding was widespread among respondents irrespective of the MPR they chose. However, optimism was stronger for people who married under the
61 Mahar, “Why Are There so Few Prenuptial Agreements?”
0 10 20 30 40 50 60 70 80 90 100 Frequency 53 59 24 30 9 45 6 4 1 2 8 0 10 20 30 40 50 60 70 Fre q u en cy
community of gains regime. They reported a median probability of divorce of 10%, whereas the median for people who married under marital partnership and separation of property was of 20%. On average, people reported their probability of divorce was 19.9 lower than the divorce to marriage ratio. Lawyers were as optimistic as people without a legal background (see Appendix, table 4).
While optimism was prevalent among respondents independent to the MPR they chose, respondents who already divorced reported less optimism. This subgroup indicated their particular probability of divorce was 40% (median), which is only a 10% lower than their estimate of the divorce to marriage ratio (see Appendix, table 5).
5. 3. Correlation between people’s perceptions about how most of their relatives and friends marry and the MPR they choose
The results show a high correlation between people’s perceptions about the MPR their relatives and close friends chose and the MPR they chose. A statistical anal-ysis of the relationship between the MPR respondents chose and the one they perceived most of their relatives and friends chose allows concluding that there is a correlation between both variables no resulting from chance (Chi-Square test p < .01with contin-gency coefficient of 0.643, indicating a relationship moderate to high, see Appendix from table 7). Respondents who married under separation of property even erred at identifying that most people in Chile goes along with the default MPR at the time of the marriage. In fact, most of them responded that most people in Chile opted-out to sep-aration of property at the time of the marriage. A reasonable explanation for this mis-perception is that they drew an inference about the whole Chilean population on the grounds of what was more available to them (the MPR most of their relatives and friends chose).
As previously indicated in the introduction of this work, when people face a de-cision about risks they tend to rely on heuristics. And one of those heuristics consists of following what other people do. Indeed, when people do not know how likely an event is, they may follow “the views of trusted others.”62 What other people do has an
expressive content. It conveys information about what is probably best to do or think. In addition, social norms can also impose peer pressure.63 This survey did not aim to
distinguish whether people felt peer pressure or whether they saw an informational value on what their relatives and close friends chose. But in such a sensible social prac-tice, it is likely people will tend to conform to a large extent for social pressure. In this
62 Sunstein, Simpler, 69.
63 Thaler and Sunstein, Nudge, 55. (“Social influences come in two basic categories. The first involves
information. If many people do something or think something, their actions and their thoughts convey information about what might be best for you to do or think. The second involves peer pressure. If you care about what other people think about you (perhaps in the mistaken belief that they are paying some attention to what you are doing—see below), then you might go along with the crowd to avoid their wrath or curry their favor.”).
regard it is important to note that the three MPR are prevalent among people from different educational backgrounds, age, and religious beliefs. However, while for re-spondents who married under separation of property what their relatives and close friends chose was a relevant justification for their choice, for respondents who opted out to separation of property and community of gains the main reason was having more independence. For people who opted out to separation of property divorce had almost an insignificant role in the decision they made.
5. 4. Widespread ignorance concerning the limitations the default MPR imposes on women
One of the main aims of this study was to determine why 55% of spouses goes along with the default MPR despite current divorce rates and the limitations this re-gime imposes on women to administer her own goods as well as the partnership. One of the working hypothesis was that people probably did not know what they were agree-ing to when they married decidagree-ing to follow the default MPR. And this hypothesis proved to be true for a significant percentage of respondents. Indeed, 43% of people indicated they did not know about the limitations the marital partnership imposed on women. However, these limitations were more salient to women than men. Indeed, 47.6% of men responded they ignored such limitations, while only 39.3% of woman acknowledged they did not know about the limits they would face to administer her own goods (see Appendix, table Nº 9).
This result is puzzling. While the difference between men and women is not sta-tistically significant, perhaps some women did not want to acknowledge they ignored the restrictions they would face under the default MPR. People without college educa-tion reported higher rates of ignorance concerning this restriceduca-tion. In fact, 62.5% of women with college education or graduate education indicated they knew the re-strictions the marital partnership entailed and 47.1% of women without a college de-gree responded they were aware of the restrictions. Though a 60% of women affirmed they did know what they were agreeing to, it is alarming to see that almost 40% of women ignored the restrictions they would face to administer their own goods and fol-lowed a default MPR that discriminates against them.
5. 5. Most people who followed the default would opt-out to separation of property if their probability of divorce was 50%
Most respondents who opted out to separation of property or community of gains would stick to their current MPR in case their probability of divorce was 50%. However, 61.2% of respondents that went along with the default would have chosen a different MPR facing a 50% probability of divorce. As it is evident in the table 11 in the Appendix, out of the 30 respondents who went along with the default MPR and would change the MPR they chose facing a likelihood of divorce of 50%, 26 (87%) would choose separation of property and 6 community of gains (13%). Interestingly, 19% of
people who opted out to separation of property would choose a different MPR facing a probability of divorce of 50%. Fifty three percent would switch to community of gains and 47% (14 people) to marital partnership. All people who opted out to community of gains and would switch of MPR facing a 50% chance of divorce would switch to sepa-ration of property.
This finding shows that most respondents would have opted out to separation of property had they known the actual divorce rates and considered themselves as av-erage in the probability distribution of divorce.
5.6. Most people would find it acceptable to switch the default to
sep-aration of property
In light of the working hypotheses of this work, the survey included a last ques-tion to determine whether people would find it acceptable to switch the default MPR to separation of property. Almost 80% of people would find acceptable to switch the default rule. If the default rule has an impact on a subgroup of spouses, then the choice architect should not incite people to follow an MPR that is not a good fit to the current family model and imposes significant costs in case of divorce. With some qualifications that will be discussed in the next section, this article concludes that switching the de-fault rule to separation of property would be a recommendable nudge, which would provide greater save costs to spouses and the state, as well as unexpected surprises to women.
6. Discussion
This work was motivated by a puzzling question: why do 55% of spouses go along with the default MPR in Chile despite its discriminatory administration rules and cur-rent high divorce rates? A recent article suggested that this high defaulting rate might
79% 21%
Would you find acceptable to switch the default MPR to separation of property?
be due to the power of default rules.64 It was a reasonable working hypothesis to begin
with since people might not pay attention to the MPR before the marriage. If they do, they might fear that suggesting to opt-out may signal distrust. In order to provide a comprehensive assessment of my respondents’ decision to go along with the default MPR this study also included other working hypotheses related to the behavioral law and economics framework: the influence of social norms; optimism; and mispercep-tions about the law.
The main findings show that the default MPR did not impose an emotional cost on most respondents who decided to marry under the marital partnership. Indeed, 67% of respondents who went along with the default did discuss with their spouses which MPR fitted them best. If there was deliberation, the default did not impose an emotional tax on them—at least not high enough to prevent a deliberative choice among spouses. The case of the remaining 33% of respondents who went along with the default MPR is harder to assess. Almost 70% of them did not know the restrictions the marital partnership imposes on woman. This subgroup did not consider important to discuss which MPR was best for their marriage. Yet, the MPR their relatives and friends chose was important to them, and they also indicated that suggesting to opt-out might have signaled distrust.
This 33% of respondents while a minority in this sample, may well be a majority in a representative sample. In fact, 75% of people who defaulted without deliberation had no college degree. Chile is the second most unequal country in Latin America and most people lack education.65 The survey results showed there was a correlation
be-tween the educational level of respondents and the MPR they chose. If more educated people find opting-out more convenient just because they have better information and better access to expert advice, then there is a distributional problem in that the higher costs of divorce are imposed on people who lack access to those resources. Thus, fur-ther research would do well in focusing on this subgroup of respondents. When as-sessing their knowledge of the restrictions women married under the marital partner-ship face, examples of transactions to which the married woman can enter without au-thorization and others to which women may not enter without her husband’s authori-zation would provide a more reliable measure of people’s knowledge of the law. This method would test their actual knowledge of the law and not their self-reported knowledge of the law.
The 55% of people going along with the default MPR is better explained for this sample because of people’s misperceptions about the actual divorce rates, ignorance about the restrictions the marital partnership imposes on women, and the fact that most of their relatives and friends went along with the default. Indeed, 61.2% of re-spondents who defaulted indicated they would have opted out to either separation of
64 Gatica R., “El Destino de La Sociedad Conyugal,” 173.
65 However, access to education is increasing significantly. See, “Progress and Its Discontents,” The Economist, April 14, 2012. (“Chile has made a big effort to increase access to education, partly by
allow-ing private entities to run schools and universities. Politicians from both main coalitions repeat the num-bers with pride: over 1.1m young people now study in universities or technical colleges, up from just 200,000 in 1990. That amounts to around 45% of 18-24 year olds. Over 70% of these students are the first generation in their families to go on to higher education.”).
property or community of gains had their particular probability of divorce been 50%. For some of them such probability perhaps is 50% or higher and optimism led them to choose the wrong MPR. The correlation between what relatives and close friends chose and what respondents chose also sheds light on the importance of people’s social envi-ronment to make a good choice.
One of the most important findings of this study is that people misperceived both the divorce to marriage ratio and the crude divorce ratio. However, people only underestimated the former in 1/3 while they overestimated the latter by a factor of 100. The crude divorce ratio leads people to think divorce is less prevalent than it really is. Governments may do well at preferring the divorce to marriage ratio to provide a more educative statistic and nudge people to choose the MPR with a better estimate about the odds of divorce.
Relatedly, the fact 43% of people who defaulted were not aware of the re-strictions the marital partnership imposes on women is alarming. While Chile is obli-gated to amend the administration rules of the marital partnership, the legislative pro-ject shows no progress at all.66 In the meantime, informational campaigns may help
people to make more informed choices and aid to include the issue in the public agenda. Today, every person who wishes to marry in Chile must take an informative course before the marriage.67 The public official before whom the marriage takes place
makes sure to ask the spouses whether they know the main duties and rights of the marriage. It may be in the best interest of spouses and the state to include a simple summary of relevant information about the main features of each MPR as part of this informational procedure. The more people marry under separation of property, the lower the costs are for spouses and the state in case of divorce.
While the default rule may have had an impact for only 16 people of this sample (7%)—a subgroup of people that is very likely to be underrepresented in this sample— if the default MPR has an impact on people’s decision making it should be designed to nudge spouses towards an MPR that represents the independence that spouses de-mand in modern families and minimizes the costs of divorce. Unfortunately, only 5 respondents indicated they opted out after the marriage and their responses were not coherent enough to draw inferences. Nonetheless, ex-post opt-outs are a prevalent phenomenon in Chile and they impose the same costs that divorces yield regarding the dissolution and liquidation of the marital partnership. The foregoing assumes the spe-cific tort that compensates the spouse who works less than he or she wanted and could to take care of the household is effective. Some people justify the marital partnership as a type of insurance for the wife. However, the problem of leaving the weakest spouse (usually the wife) with no goods or fewer than those he/she deserves—a very important problem indeed—can be addressed with damage claims. A reform may do well in con-sidering this concern granting an injunction to the weakest spouse, to avoid fraudulent transfers of property.
66 Gatica R., “El Destino de La Sociedad Conyugal,” 171. Corroborated in the website of the Chilean
Con-gress on May 2, 2016.