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American Economic Review 1989

How to Carve a Medical Degree: Human Capital Assets in Divorce Settlements

Severin Borenstein; Paul N Cournat

Abstract

This paper examines effects of the legal rules for property division at divorce on investment in human capital during marriage. The authors show that current rules generally lead to suboptimal levels of investment and spousal support, or to inequitable distribution of the returns from such investment, or both. They propose a new rule that performs better than the existing rules on both efficiency and equity criteria and that requires no more information than the existing rules.

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