Why do most people follow the default matrimonial property regime in Chile?
Keywords:
atos de concentração, mercado relevante, Teste do Monopolista Hipotético (TMH), Proportionally Calibrated Almost Ideal Demand System (PCAIDS)Abstract
Spouses in Chile have three different choices of matrimonial property regimes: marital partnership, separation of goods, and community of gains. The default regime is the marital partnership and most people stick to it at the moment of marriage. Spouses can, however, opt out before and after the marriage to any of the two other alternatives. Taking into consideration data from 2006 to 2014, 55% of spouses in average stuck to the default matrimonial property regime.
The prevalence of defaulting at the moment of the marriage is despite the increase in divorce rates, the discriminatory nature of the regime towards women, and a significant rate of ex-post opt-outs. The foregoing sheds doubt on the reasons why people—and particularly women—might prefer the marital partnership. This study attempts to determine: (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 divorce rates; (iv) optimism bias; and (v) knowledge of current restrictions women face under the marital 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 run an experiment in social media, surveying married people in Chile. The findings showed that the default did not impose an emotional burden for most people who decided to stick to the default. While inertia and herd behavior might have had an influence on 33% of people who defaulted, ignorance about the actual divorce rates, optimism and unawareness about the restrictions the marital partnership imposes on women explain better the high rate of spouses that stick to the marital partnership. In light of current divorce rates this is a sub-optimal outcome, triggered by asymmetries of information and optimism. Informational campaigns should overcome this failure. In addition, switching the default rule would be a positive nudge to help people make better decisions.
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