The Welfare Effects of Mobility Restrictions

Review of Economic Dynamics, 2003, vol. 6, issue 3, 685-696

Abstract: Mobility restrictions (e.g., severance payment, life-long tenure, and divorce ban) are widely observed. I present a partnership model that highlights the 'break-up externality' (i.e., the negative effect of a person's break-up decision on his current partner). Under this externality, there is too much searching for new partners and too much breaking-up of existing partnerships. Restrictions such as a break-up payment and break-up ban can reduce the levels of searching and breaking-up and improve welfare. Thus the paper rationalizes mobility restrictions as welfare-improving arrangements. (Copyright: Elsevier)

Keywords: mobility restriction; partnership; search; break-up (search for similar items in EconPapers)
JEL-codes: D62 J41 J60 (search for similar items in EconPapers)
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed

Downloads: (external link)
http://dx.doi.org/10.1016/S1094-2025(03)00015-2 Full text (application/pdf)
Access to full texts is restricted to ScienceDirect subscribers and ScienceDirect institutional members. See http://www.sciencedirect.com/ for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:red:issued:v:6:y:2003:i:3:p:685-696

Ordering information: This journal article can be ordered from
https://www.economic ... ription-information/

DOI: 10.1016/S1094-2025(03)00015-2

Access Statistics for this article

Review of Economic Dynamics is currently edited by Loukas Karabarbounis

More articles in Review of Economic Dynamics from Elsevier for the Society for Economic Dynamics Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().