Female Household Labor and Financial Settlement at Divorce: Evidence from South Korean Judicial Decisions

Divorcing couples often fail to resolve financial disputes among themselves, requiring judicial intervention. In particular, the valuation of female household labor proves to be a complication for settlement. In this study, we analyze how female labor-force participation status affects marital property division (MPD) in divorce trials of South Korea. We estimate MPD and child custody (CC) equations using data from South Korean family courts for the period 2009–2011. Our results suggest the following: First, MPD is lower by 5.2 percent($81,700) on average for wives devoted to household labor compared to those engaged in market labor, showing that Korean judges tend to undervalue household labor. Second, the effect of CC on MPD is positive. If the wife has CC, then MPD increases by 6.1 percent, resulting in an average of $95,800. Third, the younger the wife or the longer the marriage, the higher the likelihood for the wife to claim CC. Fourth, the likelihood for the wife to receive CC increases if the grounds for divorce include maltreatment of the wife or her family.