Property Rights and Transaction Costs in Marriage: Evidence from Prenuptial Contracts

Economic History Association

Property Rights and Transaction Costs in Marriage: Evidence from Prenuptial ContractsAuthor(s): Gillian HamiltonSource: The Journal of Economic History, Vol. 59, No. 1 (Mar., 1999), pp. 68-103Published by: Cambridge University Press on behalf of the Economic History AssociationStable URL: http://www.jstor.org/stable/2566497 .

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Property Rights and Transaction Costs in Marriage: Evidence.from Prenuptial

Contracts GILLLAN HAMILTON

I examine prenuptial contracting behavior in early-nineteenth-century Quebec to explore property rights within families and the efficacy of marital property laws. Drawing on a transaction cost framework, I examine the decision to sign a contract and couples' property rights choices. I find, for example, that couples signing contracts tended to choose joint ownership of property when wives were particularly important to the household. These findings illustrate the potential effects of legal institutions on individuals' behavior (such as the importance of family labor, human capital acquisition, and even mating decisions) and the value of a flexible legal environment.

In modem Western society, husbands and wives are legally equal partners in marriage. In the past, however, husbands retained sole control over all

marital assets. Although there are several explanations for this institutional transformation, there is a pervasive sense that it was a change for the better-indeed, a sense that society would have been better off if the enlighten- ment had occurred long before it did! I Is this really the case? Were the laws governing marital property archaic or optimal before legal 'equality' arose? These questions are typically difficult to answer, in part because of uniform application of the law across individuals. Early-nineteenth-century Quebec offers a unique opportunity to study this issue because many couples signed

The Journal of Economic History, Vol. 59, No. 1 (March 1999). C The Economic History Association. All rights reserved. ISSN 0022-0507.

Gillian Hamilton is Assistant Professor, Department of Economics, University of Toronto, 150 St. George St., Toronto, Ontario, Canada, M5S 3G7.

The Montreal History Group very generously provided the data for this project. I am especially grateful to Bettina Bradbury for conveying the data to me, and explaining some of the coding and contract intricacies. I retain responsibility for coding the contracts to machine-readable form. I made use of many of the codes developed by the Montreal History Group (ethnicity of the participants, for example), but coded a number of the contractual terms myself. I also organized the occupation groups differently. Michael Baker, Maristella Botticini, Loren Brandt, Stanley Engerman, Claudia Goldin, Frank Lewis, Aloysius Siow, Nathan Sussman, as well as two anonymous referees and co-editor ofthis journal, Gary Libecap, offered guidance and very helpful suggestions. I also thank seminar participants at Queen's University and the Canadian Quantitative Economic History conference, as well as participants of the 1995 EHA meetings for comments on a very preliminary draft.

1 One of the most common explanations for the evolution of marital property laws in nineteenth- century North America is that there was a growing desire to provide wives who had abusive or absent husbands the means with which to support themselves. The reforms tended to begin by establishing, and then enhancing, women's control over their inherited property. Eventually these rights were extended to women's earnings. See Chambers, Married Women; Salmon, Women and the Law; Shammas et al., Inheritance; and Basch, In the Eyes.

68



Property Rights and Transaction Costs in Marriage 69

prenuptial contracts that altered spousal property rights.2 Quebec couples signing contracts chose property arrangements that appeared either modem or relatively archaic: they chose either a 'community' property arrangement where most of the couples' assets were held jointly, or a 'no-commumty' scheme, where husbands were the sole residual claimants. In addition, wives were usually promised an annuity that derived from their husband's estate when he died. The variation in property rights provides an opportunity to gauge the effect of different property regimes by attempting to determine couples' reasons for altering their property rights. In turn, this allows us to gain a sense of the relative efficacy of different property laws.

I find that couples' contracting decisions are consistent with the notion that marital property rights were expected to influence peoples' incentive to participate in the household. The results suggest that the availability of contracting in Quebec allowed some couples to partially overcome the transaction costs associated with marriage. This implies that in environments where contracting was costly, property laws may well have affected men's and women's occupation choice, reliance on family labor, and human capital decisions.

To consider couples' property rights decisions, it is first necessary to understand the property rights they faced. Quebec property laws were based on French law, particularly the Custom of Paris. The laws dictated that, in the absence of a contract, all of a married couple's assets, earnings, and debt were held jointly, with the exception of land or real estate inherited through family lines (joint assets are termed 'community' property, the rest is 'ancestral' property-see Figure 1).? The administration of these assets, however, was exclusively the husband's domain, although he could not sell his wife's ancestral assets without her consent. These laws not only identi- fied property rights during marriage but also determined inheritance (divorce was not recognized by the church or the state in Quebec, and was very rare elsewhere in North America). Surviving spouses claimed half the community property and retained their ancestral assets. Their children, or, in their absence, surviving relatives in the direct line of the deceased, received the other half of the community. Before 1841 widows also were entitled to a lifetime interest in half their late husband's ancestral assets. This was known as the customary dower (dower rights did not extend to men).4 After 1841 the right of dower was struck down, limiting widows' claims to half the community property.

2 Quebec marriage contracts have been studied by Bradbury et al., "Property"; Dechene, Habitants;

Desloges, Tenant's Town; Dionne, Contrats; Landry, "Gender Imbalance"; and Stewart and Bradbury, "Marriage Contracts."

I Quebec property laws are described in Doucet, Fundamental Principals. These laws were similar to the laws in other Roman-influenced countries (southern France, Italy, and some of the southern

United States). 4 Children inherited the customary dower once their mother died.



70 Hamilton

Husadd$ ....._ ..W's Ancc*CAmuit Aw

FIGURE 1 HOUSEHOLD ASSETS WITHOUT A CONTRACT:

QUEBEC VERSUS ENGLISH NORTH AMERICAN PROPERTY LAWS

Notes: Quebec Law: Ancestral assets are land or propery ssed through the family line. Community assets are everytiing except ancestral assets. The survivor retains his or her ancestral property and receives half the community assets.

EnglishNorth American Law: The husband's assets consist of everydting except the wife's ancestral assets (community assets plus his ancestal assets in the diagram). A widow reclaimed her ancestral property and could usually claim a life interest in one-third of her late husband's assets.

Community property arrangements were not unique within North Amer- ica. They were also found in a number of Spanish-influenced American states (Louisiana, Texas, Nevada, and California, to name a few of them).5 In most American states and English Canada, the British legacy of common law prevailed. In these jurisdictions, all household assets belonged exclusively to the husband (this included the husband's and wife's eanings and other income acquired during marriage). Wives retained ownership of their ancestral lands (as in civil-lawjurisdictions like Quebec), but their husbands administrated these assets and owned the income they produced (see notes to Figure 1).6 Hence as distinct from the French norm, women married in an English jurisdiction gave up all claim of ownership to the household assets. Women who outlived their husbands regained ownership of their ancestral property (land brought into the marriage) and received their dower-a life interest in one-third of their husband's lands. Apart from that, they could claim only their 'paraphernalia'-clothing, jewels, and personal items-but not money, animals, dishes, furniture, or other household items.

Betrothed couples in Quebec could alter the legally defined ('default') property arrangements with a marriage contract. A notary public drew up the

5 See Shammas et al., Inheritance. 6 This is a simplistic description of American and English-Canadian propert laws that ignores the

substantial variaton in married women's property laws across states and provinces. See Salmon, Women and the Law; or Shammas et al., Inheritance, for descriptions of the diversity in laws across American states; and Backhouse, Petticoats, for a discussion of English Canadian law. There are also a nunber of state-specific studies. Narrett, Inheritance, for example, examines property laws in New York; Wlson, Life, discusses Pennsylvania; the papers in Guildford and Morton, Separate Spheres, focus on Maritime C and Chambers, Married Women, studies Ontario.




Husband's Separate Wife's Se Ast (,*e rmeduds) X'S

Husband's _1 1 i: A'ts~~~~~~~~~~~~~Ast Ansul .A-.l|

FIGURE 2 HOUSEHOLD ASSETS WITH A NO-COM4UNITY CONTRACT

Notes: Wife's separate assets: those declared to be hers (through inventory or receipts). The suvivor retains his or her ancestral and separate propert. Unless stated, she (or he) has no claim on the spouse's separate (or ancestral) assets. Annuities, lump sump, lifetime, or pure gifts, for example, would change this-the survivor may then have a full or lifetme claim on some or all of the deceased's assets.

agreement a few weeks or days before the wedding, with parents and close friends or relatives in attendance. The document first contained a pledge by each party to marry their betrothed. It then stated whether the couple retained or rejected the 'community of property' dictated by the laws of Quebec. If they rejected it, the contract usually stated that the couple would hold assets they now owned, and those acquired in the future, separately (see Figure 2). In this case, the husband was the residual claimant, but the wife owned whatever assets were specifically designated her own. The same distinction between separate versus joint liability was made for past and future debts. Couples choosing to hold their assets separately sometimes went further and awarded wives thefemme sole status they had as single women-ownership over their earnings and the right to administrate their own property. Unless the agreement specified this explicitly, though, administrative control of a woman's assets and earnings remained in the husband's hands. The contract then addressed the dower laws. Couples usually rejected the customary dower-eliminating wives' claim to their spouse's ancestl property-but typically replaced it with some form of annuity payable from their husband's estate during their widowhood. The contents of the agreement were binding and could not be altered once the marriage was consecrated (even if both parties desired a revision). They could subsequently craft a will that devised unaccounted assets, but it could not reduce the wife's inheritance promised in the contract.7

7 ".The husband ... cannot dispose of [assets] common between him and his wife, to the prejudice of the said wife, nor the half of what may belong to her in the same by the death of her husband."



72 Hamilton

In the early nineteenth century, roughly one out of every six couples marrying in Quebec signed a prenuptial contract. This is much higher than the proportion signing contracts elsewhere in North America.8 Marylynn Salmon, for example, finds that 1 to 2 percent of couples in South Carolina signed marriage settlements (contracts) between 1790 and 18 10.' Couples in Quebec may have viewed contracting as fairly accessible, in part because there was a long history of signing prenuptial contracts in Quebec, France, and other countries with Roman-based laws.10 In addition, the institutions for signing contracts were well established (the notary publics, the laws, and the court).11 This was not the case in much of English North America, where equity courts were not established in many states and provinces until well into the nineteenth century.12

Why would couples choose to sign a prenuptial contract? There are several possible explanations. One possibility is that the essence of a contract was the promise of marriage inscribed near the beginning of each agreement. In parts of sixteenth-century France, for example, matrimonial court cases were most often suits to enforce a promise of marriage (some of which were made in contracts).13 Another possibility, more commonly raised about English North America, is that the contract (often called a 'marriage settle- Doucet,FundamentalPrincipals, p. 280, article 296. Before 1801 a husband coulddevise only one-fifth of his ancestral assets, after that he could devise all of these assets as long as it did not interfere with his wife's dower (set by contract or, in its absence, the law before 1841).

8 Demographic variables do not appear to account for this difference in contracting rates because the Quebec marriage market does not appear to have been very distinct from other, early settled, North American colonies. The average age at first marriage was roughly 22 for women and about 25 for men (derived from the 1825 census, using Hajnal's, "Age," technique). Wells, "Population," calculates that the mean age at first marriage was about 23 for women and 26 for men in late-eighteenth century American colonial states. See also Haines, "Long Term Marriage Patterns."

9Salmon, "Women and Property." '0 Prenuptial contracts in France were similar to those in Quebec. Darrow, Revolution, has shownthat

contracts from early-nineteenth-century Montauban (in southern France), for example, addressed issues of property rights and widow support. Couples chose different property forms that were similar to the community and no-community distinction made in Quebec. Dowries were, however, a much more common and important element of these contracts. The contracts defmed the dowry, the term of its payment (if necessary), and relevant property rights (such as whether it would be inherited by the bride's or groom's family after the woman's death). See also Gibson, Women.

"It was also fairly affordable (a contract cost about 12 shillings). Bradbury et al., "Property," p. 28. 12Maiage settlements in the English colonies were generally not enforceable until a Chancery (or

equity) court had been established. Several states (Connecticut, Massachusetts, and Pennsylvania) did not establish separate Chancery (or equity) courts before the early nineteenth century; while they were active in New York, Maryland, South Carolina, and Virginia (Salmon, Women and the Law, p. 82). In Ontario, this court was not established until 1837 (Chambers, Married Women, p. 53). See also Ward, Courtship, for a general discussion of marriage in Ontario.

13 Camden, Elizabethan Woman, emphasizes the role of the promise in a marriage contract. Its role is also discussed in two studies of marriage contract disputes: Watt's study of Neuchatel ("Marriage Contract Disputes"); and Houlbrooke's, "Making," on fourteenth-century England. In Protestant societies the contract itself could be construed as marriage (consecration by the church was unnecessary), hence contract disputes were interpreted by the court as petitions to dissolve a marriage, not an engagement, even if no wedding had taken place.




ment' or 'trust') was an attempt by the bride's family to wrest some of her assets from her future husband's control."4 With a trust, a family transferred assets intended for the bride to a third party. He was obliged to manage the assets for her profit and benefit, which allowed her to receive some of the income earned from her estate without having to relinquish the property to her husband. These agreements were cumbersome and used only among the wealthy.15

There are several reasons why these two explanations for contracts are not entirely compelling in the Quebec context. First, neither explanation offers insight into these couples' property-choice behavior, because the form of property assignment (community or not) is irrelevant in either context.16 Second, women may have been less concerned with protecting their property in an environment where they automatically inherited half the community property. Third, prenuptial contracts were not restricted to the elite as they were in America (hence other factors may have led couples to sign such agreements). Finally, the promise to marry was likely of minor consequence because couples tended to marry fairly soon after signing the contract.17

Few studies address the property regime decision directly, but three explanations predominate. First, a number of studies argue that couples gave wives control of some assets (either through no-community or a trust) in order to limit creditors' claim on the estate.18 As Salmon notes, however, couples with this intention ran the risk of limiting their access to credit, as it was not difficult for creditors to determine whether a couple had entrusted the wife with some of the household's assets.19 Second, anglophones may have been particularly uncomfortable with the foreign notion of community property, and sought no-community contracts that were more similar to English law.20 Culture certainly seems to play a role, as anglophones who

4 See Salmon, "Women and Property" and Women and the Law; and Chambers, Married Women. 15 In England, the Chancery court first upheld married women's right to a separate trust in the late

sixteenth century (Salmon, Women and the Law, p. 84). Also see Bonfield, Marriage Settlements. For a general examination ofEuropean marriage, see Stone, Family; and Hajnal, "European Marriage Patterns."

I6 Limiting husbands' access to their wives' property could be accomplished, to varying degrees, under either a no-community or community agreement, and thus does not reveal the distinguishing attributes of the two states. Within community contracts, for example, assets that were destined for the community (such as a future cash inheritance) could be 'removed' from it and marked as part of an individual's ancestral property, if they were explicitly assigned as such in the contract. The strongest restrictions on a husband were accomplished when the contract adopted no-community and provided wives with explicit administrative control of their assets. Most contracts in Montreal did not adopt this regime.

17 In Landry's examination of the marriage patterns of thefilles du Roi (single French women sent to the colony to correct a gender imbalance in the 1660s), "Gender Imbalance," he found that the average interval between contract and wedding was 19 days. More than half waited less than ten days. Couples were supposed to wait for three publications of the banns before their marriage could be blessed.

See, for example, Chambers (Married Women, chap. 6); and Bradbury et al., "Property." '9Salmon, "Women and Property." 20 a contemporary Englishman living in Quebec describes, "A man who has made a fortune here

conceives that he ought, as in England, to have the disposal of it as he thinks proper. No, says the Canadian [Quebec] law, you have a right to one-half only; and if your wife dies, her children, her near- est relations, may oblige you to make a partage, and give them half your property .... Nothing can



74 Hamilton

signed contracts in Montreal almost always rejected community, but many more anglophones in Montreal did not sign contracts (and so retained a community of property), and some francophones also sought no-community. Third, it can be argued that the distinction between community and no-community was unimportant, because husbands usually administrated the assets in either case.2" This does not, however, explain why couples made this property distinction in their prenuptial agreements.

The argument raised here is that despite the fact that men usually had administrative control over household assets, choosing community versus a no- community property arrangement meaningfully affected the distribution of resources within households. Althoughwomen's control over assets may have been somewhat circumscribed even if they 'owned' them in the eyes of the law, it is possible that women who claimed half the community had more input into household spending decisions than women with no ownership rights.22 Even ifthis effect was negligible, however, property rights undeniably affected inheritance. Men and women likely were influenced differently by this, because women tended to outlive their husbands.23 Men's primary concern regarding inheritance rights may have been bequests, whereas women's concern would have included their own prosperity during widowhood.24

Following Douglas Allen, I argue that couples signed marriage contracts that altered property rights to modify spouses' incentives to participate in the production of jointly produced marriage goods, where individual effort is difficult to observe.25 When such transaction costs exist, individuals' incentives to participate in joint production (hence their effort and household production) can be affected by their property rights.26 This is a distinguishing feature of a prenuptial agreement. The same asset division can arise expost (through a will, for example), but such a device will have less influence on

prevent this but an ante-nuptial contract of marriage, barring the 'communaute de biens'." Hugh Gray, Letters from Canada Written During a Residence There in the Years 1806, 1807 and 1808, London, 1809, cited in Bradbury et al., "Property," p. 17.

21 As has been noted, the husband relinquished administration of his wife's assets in some no-community cases.

22 this is essentially the argument made in the contemporary bargaining literature. See Lundberg and Pollak, "Separate Spheres."

23 In 1831 Quebec males at age 25 anticipated another 37 years of life, whereas a 20 year old woman expected to live another 42 years (the reduction in life expectancy from childbearing deaths is com- pletely offset by the longer life expectancy of women, relative to men, who live to age 40). Bourbeau and Legar6, Evolution, p. 120. If her husband predeceased her whenhe was 62 (as expected), she could expect to live roughly another 18 years. David and Sundstrom, "Old-Age Security" (p. 170) derive a similar (slightly longer) conditional widowhood period (18.9 years) for people marrying in Massachu- setts between 1801 and 1820.

24 See note 20. 25 Allen, "What Does She." Related papers in the marriage literature include Allen, "Marriage and

Divorce: A Comment"; for a different view, see Peters, "Marriage and Divorce" and "Marriage and Divorce: Reply."

26 Parties contract over property rights and not effort directly because effort is difficult to measure.




effort during the marriage. Notably, the existence of transaction costs is a common explanation for the coexistence of different forms of tenancy in agriculture (sharecropping versus wage or rental agreements).27 To explore these issues, I draw from Mukesh Eswaran and Ashok Kotwal's sharecropping model designed to explore tenancy choice and from Allen to account for couples' decisions to adopt community or no-community property arrangements.28 The model also sheds light on the relative size of annuities in the contracts and the decision to sign a contract.

A few caveats are in order. This approach is not meant to diminish the sufficiency of love. A prenuptial contract that provides individuals with appropriate incentive to exert effort in marriage is clearly not required for all or even most couples. This approach indicates circumstances under which such an arrangement might be appropriate. Furthermore, this is clearly not the only reason to sign a prenuptial contract (competitiveness in the marriage market is pursued here as well), but it offers considerable insight into these couples' property choices and the efficacy of marital property laws more generally.

This article offers two broad implications. First, in the absence of widespread contracting, property laws may affect such factors as an individual's occupation choice and human-capital-investment decision. Production and work may have relied more on wives (and families) in societies with joint ownership of marital assets. The return to human capital investment also would have been higher for women (and lower for men) in such environments. This might help to explain, for example, the comparatively high female-to-male literacy rates in Quebec relative to some of the American states.29 Second, the ability to tailor property laws easily to individual cir- cumstance may have been (and may be) beneficial in societies with high transaction costs in marriage and in cases with mismatched couples.

TRANSACTION COST APPROACH TO MARITAL PROPERTY CHOICE

The marriage market is assumed to have been competitive. A prospective spouse's value in the market was determined by the value of his or her productivity in the various activities he or she undertook (the husband' s is v, the wife's u). Husbands and wives are assumed to have derived utility from income and leisure and (separably) children. Children provided resources to the family when they were grown and their intrinsic value provided a motive for bequests. People divided their time between work, home production (child rearing, for example), and leisure. Child rearing and some jobs are assumed to have beenjoint activities that required both spouses' inputs. Men

27 Eswaran and Kotwal, "Theory"; Alston and Higgs, "Contractual Mix"; Altson, Datta, andNugent, "Tenancy Choice"; and Allen and Lueck, "Risk."

28 Eswaran and Kotwal, "Theory." 29 Female literacy rates were higher among both English and French children in late-1830s Quebec

(Greer, "Pattern"). For the United States see Murray, "Generation(s)."



76 Hamilton

worked, engaged in housework and child rearing, or spent time on leisure. Their work took one of two forms: jobs or businesses that required their wives' inputs (joint enterprises) or ones that demanded only their own time. This distinction reflects the fact that wives' (and children's) inputs were particularly important in occupations such as farming or in cases where artisanal shops were attached to the family home.30 Married women allocated their time between their ownjobs (work that did not require their husbands' input), their husbands' jobs (ifjoint), housework and child rearing, or leisure.

The optimal property arrangement depended on the effort individuals allocated to tasks in which they were relatively productive. They faced a choice between leisure and income. Each spouse's input into jointly produced 'marriage' goods (children and joint businesses) was difficult to observe because tasks were generally unmonitored and output realized long after the inputs were provided. Hence individuals had incentive to shirk in the production ofthese goods. Varying the property arrangement would have affected an individual's incentive to shirk.

Three property arrangements are assumed possible: community; no-community where the husband is the residual claimant; or no-community where the wife is the residual claimant. Property assignment determines individual inheritance rights and asset ownership during marriage. If a person had property rights over her or his earnings, however, this did not necessarily mean that that individual alone consumed all goods purchased. Some were public goods consumed by all family members (such as the home and possibly some of the benefits derived from children).3' For simplicity, men are assumed to have chosen the optimal contractual arrangement and reaped the rents, whereas wives received their opportunity value, u, regardless of the contract choice.32 The gender of the person choosing the regime does not affect the optimal choice, it determines only the recipient of the rents. A husband maximized his expected utility, choosing the arrangement with the highest utility.

Under a no-community arrangement where the husband is the residual claimant (no-community/H), the wife derived utility from her own leisure (which is not transferable), public goods, and if necessary a fixed sum (a) transferred from her husband to ensure that she received the utility equivalent of her outside value, u (Table 1).3 She had no direct claim to assets derived

30 There is a large literature documenting women's role in the household. See, for example, Goldin, "Economic Status"; Cohen, Women's Work; and Hufton, Prospect.

31 Some benefits from children may have taken the form of their earnings, which may have been consumed by an individual, other benefits may have been public, such as those derived from tasks performed at home.

32 The three property choices parallel tenancy options: sharecropping, wage, and rental agreements. 33 Both parties are assumed to have had no assets when they married. An equivalent assumption is that

people can have positive initial assets that raise their outside value by the amount of their initial wealth.




TABLE 1 PROPERTY RIGHTS AND UTILITY

Division of the Proceeds*

No-Community/H Community No-Community/W

Activity (inputs) W H W H W H

Nonleisure** (H, W orJ) 0 1 A2 Y2 1 0 Leisure(W) 1 0 1 0 1 0 Leisure(H) 0 1 0 1 0 1 Fixed sum (annuity)*** X + ?a T +a -b b Total (utility terms) u u u * Division of the proceeds refers to the property rights each individual has over the household's utility (output): 1 implies 100 percent of the good; '/2 implies 50 percent. Public goods are ignored. * * Nonleisure activities can include the wife's work (separate activity-her own input only), the husband's work (separate or joint activity), and child rearing and household management (joint activities). *** A fixed sum may be promised from one spouse to another to ensure that the wife receives utility level u. Notes: H=husband, W=wife, J=joint (both husband's and wife's inputs required). No-community/H (no-community/W) refers to the no-community state where the husband (wife) is the residual claimant.

from their work or their children. The husband's utility reflected his claim to all proceeds from his wife's separate business activities, his business activities (whetherjointly produced or not), other marriage goods (children, for example) and his own leisure, net of the fixed transfer his wife received.

Under a community arrangement, the couple split the proceeds of their business and marriage good activities, and each retained sole interest only in his or her own leisure time. If the 50:50 sharing rule did not provide the wife with her opportunity value (u), she could have received an additional fixed sum (a); or, if it provides her with too much utility, the husband could have received an additional sum (so the wife lost a).

In a no-community arrangement where the wife was residual claimant (no-community/W), she received all proceeds of business activities (both hers and her husband's), the children, and her own leisure, net a fixed transfer to her husband (b) set to provide her with u. Her husband received this fixed sum (b) and derived utility from his leisure and public goods. While these simplistic rules do not capture all of the variation in property rights in the contracts, they do capture the essential distinction between rejecting and retaining community property.34

34For example, the no-community/H property distribution rule does not capture the fact that some brides in no-community contracts were given full administrative control and ownership oftheir income and assets while others were not (in either case, husbands were the residual claimant). The model could directly address these cases if the rule regarding the 'top up' to the minimum utility level (u) was more complex than a fixed sum: a fixed sum plus future earnings, for example. Indeed it would be more accurate to consider the top up a fixed sum plus assets assigned in the future (value unspecified) in all no-community contracts. Limiting it to a fixed sum is a simplifying assumption that does not affect the general predictions discussed here.



78 Hamilton

Consider no-community/H a benchmark arrangement. In this case, wives had minimal incentive to allocate time to their own business or joint activities except to the extent that their contributions enhanced the public goods they may have enjoyed (such as a home). Effort onjoint activities would have been low partly because of the lack of compensation but also because inputs into these goods were not easily observed and hence the incentive to shirk high. On the other hand, husbands had considerable incentive to allocate time to income-generating tasks (work and child rearing) because they derived the maximum benefit from the marginal unit of time devoted to these activities. They would have divided their time between working and household activities according to their relative value of marginal products in these two activities.

Compared to a no-community/H property arrangement, a community arrangement provided a wife with more incentive to exert effort on work (her own and her husband's, ifjoint) and household activities (children). She would have devoted more time to these activities and less to leisure. Because the return to spending time on her own job was likely low (due to low wages), her nonleisure time was likely devoted to her husband's business (if joint), child rearing, and housework. Her husband, on the other hand, had more incentive to shirk on jointly produced goods and devote less time to his own work, because he reaped half the return he otherwise would have received on the marginal unit of effort devoted to these tasks. If the return on the wife's increased effort in business and child-rearing tasks exceeded the value of his reduced effort on these tasks, community might have dominated other arrangements. This was more likely to arise if there were economies from joint production. Note that it is possible that community also provided children more incentive to participate in their family's business activities (which would reinforce the results here).35 For brevity the discussion refers only to spouses' behavior.

A wife had even greater incentive to participate in business and household activities, and her husband had even less incentive to do so, under a no- community/W agreement. In this case, the husband allocated most time to leisure. The no-community/H regime, however, dominated this scheme as long as the husband was more productive in his market work than she was in hers. This was likely in almost all cases, especially given the legal (and possibly cultural) restrictions on married women conducting trade. For ex-

35 The risk to children of disinheritance or receiving a smaller inheritance may have been lower when both parents, instead of the father alone, owned the family's assets. This may have been particularly true in cases where the father remarried. In a similar vein, Alston and Schapiro ("Inheritance Laws") show that children had more incentive to participate in family labor in environments where their inheritance was more assured (multigeniture versus primogeniture). Note, however, that the property regime was more likely to affect the timing thanthe extent of children's inheritance, because all Quebec children (male and female) had an equal claim on their parents' estates. If their mother outlived their father they received a larger portion of their parents' assets upon their father's death with no-community. The expected delay in inheriting under community is expected to have mitigated the property regime effect on children's effort.




ample, they were not allowed to acquire debt or sign a contract without their husbands' explicit consent. It is unlikely that even a gifted woman could have generated more income from a business than her husband. Thus, although the no-community/W regime is theoretically possible, it is at odds with the institutional and cultural environment of nineteenth-century Que- bec. In fact, husbands were always residual claimants in the no-community contracts observed in the data set.

This framework has a number of testable implications for the variation in property regime and annuity values across contracting couples, and can inform our understanding of a couple's decision to sign a contract.

Marriage Attributes and Optimal Property Regime.

Community arrangements are more likely to have dominated in cases where husbands' businesses involved joint production. There are several reasons for this. A community arrangement was more likely to result in a gain in total product when the gains from both parties allocating time to the husband's business activities were particularly large. Second, this effect could be reinforced by sorting-women who were really productive in such work activities should have been more likely to marry men in businesses that entailed their direct involvement (because they would have been better off, all else equal). Third, the cost of observing inputs injointly produced goods was likely relatively high in cases with family businesses (compared to those without).36 Hence the potential gain from mitigating spouses' incentive to shirk with a community arrangement also would have been relatively high in these cases.

Matching within the marriage market (correlation between bride and groom's outside value) also may have affected property choice. Men's outside value was likely largely determined by their market activities; for women, child rearing and household management abilities likely dominated. In most competitive marriage markets, men and women with similar outside values tend to marry.37 Matching, however, does not occur with every union. In cases where it did not occur, no-community arrangements are more likely to have arisen. For example, the higher a man's productivity in nonleisure activities (work and child rearing) relative to his wife's productivity in these activities (so that u / v < 1), the greater the gain in total product associated

361 In marriages where children were the principal jointly produced good, there were fewer sources of transaction costs. In addition, labor inputs into jointly produced goods may have been less costly to observe because of the delineation in male-female child rearing tasks.

37 Although the average woman's wage in market activities was less than her husband's, her value in marriage overall may have been equal to a man's, because her productivity in nonmarket activities also benefited the household.



80 Hamilton

with the husband concentrating his efforts on nonleisure activities. Hence in this case, no-community/H would have been the optimal property arrangement. Theoretically, the same logic applies when women were expected to have been more productive than their future husbands. If she was more productive in joint tasks, such as household management, community was likely the optimal property choice.3g

Jointly produced goods also may have been a particularly important com- ponent of an individual's utility in unions with children from a previous marriage, because such individuals likely desired help with child rearing. Thus factors that affect an individual's opportunity value in the marriage market should be important predictors of contract choice.

Annuities

Annuities are captured in the model by the fixed payments (for example, a) that arose when a woman's outside value (u) was high enough to warrant them. A number of factors will affect the size of the annuity. First, the property regime. Women are assumed to have earned their alternate wage (u) regardless of the property regime. Hence the fixed payment (annuity) will be smaller if the optimal property choice is a community arrangement (a < a), because part of the transfer in community is the share of the assets. This ranking will hold as long as women are of homogeneous quality or randomly assigned across property regimes.39

Second, for women of given u, the fixed sum (a) will have depended on the quality of the public goods the household produced. The grander the home, for example, the smaller the annuity required to ensure that u was achieved. Hence factors such as husband's wealth and income will have had a negative effect on annuity size. Notably, the effect of the husband's expected earnings on the annuity would have been relatively large among community contracts, because the husband's income was likely positively related to the size of the community (and thus the half-community compo- nent of the wife's compensation). Hence the variation in annuities is expected to have been smaller in community contracts.

Third, the annuity will have depended on a woman's outsiue value. Women with scarce or valuable attributes (literacy or wealth at the time of marriage, for example), or more generally, scarce cohorts of women, would

381 In cases where the bride's skills extended to a separate business, though, a more complex no- community/H arrangement, where she retained control of her own earnings, may have been optimal. Young ("Getting Around") argues that the femme sole no-community contracts (that gave women administrative power and ownership over their assets and earnings) were adopted to circumvent the legal strictures on women wishing to operate businesses. With such a contract, they regained the right to sign employment contracts and purchase goods on credit.

39 The ranking will also hold if men earn their alternate wage and women reap the rents, as long as the rents from marriage are not uniformly larger in one regime (across marriages).




have received higher annuities. Women with undesirable traits, widows for example, are expected to have received lower annuities. This argument is very similar to that applied to dowry values (or bride prices). Numerous scholars argue that these sums vary positively with scarce attributes and gender scarcity.40

Who Should Sign a Contract?

In conjunction with Quebec's marital laws, this theoretical framework offers predictions regarding the decision to sign a contract. For example, contracts are expected to have been largely superfluous in cases where spouses were well matched (v/u approached one), there were economies of joint production, monitoring costs existed, and the woman was not particularly remarkable (u was not markedly different from the average outside value of all potential wives). In this case, a community arrangement would have been optimal, and the annuity value (a) the wife would have expected to receive in a community contract would be close to zero. These attributes likely covered most couples, especially once the cost of drawing up a contract is taken into account.41 For them, the existing property laws and their own goodwill sufficed. Contracts are anticipated in cases where women were exceptional (high outside value, especially if high relative to their husbands' value), hence it is optimal for them to have received a positive annuity, even if the optimal agreement was community); or where no-community arrangements dominated community regimes.42 Hence the assump-

40 See Becker, Treatise; Goody, Oriental; Rao, "Rising Price"; Botticini, "Intergenerational Altruism";

and Hartung, "Polygyny." In this framework, bride prices (payments from groom to bride) should arise

when women in the marriage 'pool' are scarce, and dowries should arise when eligible bachelors are

scarce. Hartung("Polygyny,"p. 344) illustrates this point, findingthat 80 percent of societies withdowries (25) are monogamous, whereas 93 percent of societies with brideprices (602) are polygynous. Potential

brides are scarce in polygynous societies, whereas gender scarcity is not (usually) predicted in monogamous societies. Siow ("Differential Fecundity") is an exception. He argues that women are generally

scarce in monogamous societies because (compared to men) women are fecund for a shorter time period. This may help to explain why bride prices are more common than dowries in monogamous societies.

41 Allen ("What Does She") argues that the transaction costs are sufficient in modern Western marriages

to render all but sharing arrangements inferior. Furthermore, he shows that as long as the marriage market

is competitive and the distribution of skills across gender is equal (so that average outside values for men

and women are equal) an equal sharing rule (50:50) is optimal. This follows because matching is a conse-

quence of market competitiveness. Thus current Western marital laws are efficient for most couples and negate any benefit from prenuptial contracts (hence their comparative rarity).

42 The woman's outside value alone (not relative to her husband's) will help to determine her annuity,

but her husband's attributes matter to the extent that spillovers (from public goods) and in-kind transfers

(half community) occur. Annuities are not expected to have been 'negative' (received by the husband), because in cases where matching does not occur and the husband is 'superior' (u / v < 1), no-community/H was more likely to have been the optimal arrangement. In such cases, the woman gave up half the commu-

nity. It is unlikely that a larger transfer was necessary. Women's relatively low market wage and legal

impediments to work are the source of the asymmetry. A woman's longer expected widowhood period

also reinforces this asymmetry: men may have put a higher weight on control of assets during marriage

(not afterwards), whereas womenwouldhave placed arelatively highvalue on income duringwidowhood.



82 Hamilton

tions ofa competitive marriage market, coupled with transaction costs within marriage, provide a framework for evaluating the incidence of contract signing, property choices, and annuities within contracts.

DATA

The data set consists of almost all marriage contracts (533) signed by couples who subsequently married in the city of Montreal during the years 1823 to 1826 (241), and 1842 to 1845 (292).43 These data were collected by the Montreal History Group, and are used in Bettina Bradbury, Peter Gossage, Evelyn Kolish, and Alan Stewart's work." The sample period overlaps census years, and was chosen bothto facilitate comparison between the contracting and city populations, and to span a period of rapid change in Montreal. During this time, the city's population grew from 22,540 in 1825 to just over 44,000 in 1844, and anglophones replaced francophones as the dominant group.

The contracts name the betrothed, and often include information on the future husband's profession, whether they were of age (at least 21 years old), and whether they were capable of signing their names. Similar details are recorded for other participants, such as the couple's parents and friends. In cases of remarriage, the late husband or wife is named. The rest of the document addresses the terms ofthe marriage contract. By matching the contracts with parish records, Bradbury et al. were able to identify the church used for the marriage celebration and, in some cases, add information on missing occupations to the data set. They were also able to determine the incidence of contracting among the marrying population.45 Although the data are rich, they do not systematically include such useful details as the asset holdings or the earnings of the groom, bride, or their families.

Most couples signing contracts were adults (over age 21), francophone, Catholic, able to sign their names, and marrying for the first time (Table 2).46 There is also evidence of matching, as couples tended to come from similar backgrounds. For example, there were few ethnically mixed (English and French) marriages and grooms tended to practice the same trade as their

43 In total, 536 contracts were signed by marrying couples in Montreal during these periods. Three were dropped from the sample: two were illegible and one contained an annuity that was almost ten times larger than the next highest amount.

"Bradbury et al. "Property." 45 The parish records for Catholics are more complete than those for other religions. Bradbury et al.

("Property") linked the parish and contract records for Catholics, but not other groups. The incidence of contracting information for non-Catholics is an approximation based on an estimate of the number of non-Catholic marriages that took place.

46 For example, anglophones comprised 24 percent of couples signing contracts in the 1820s compared to one-third of the 1825 population. In the 1840s, 33 percent of couples signing contracts had English names, but anglophones made up roughly 60 percent of the city's 1844 population.




TABLE 2 SAMPLE CHARACTERISTICS (percentages)

Sample and Couple Characteristics Husband's Occupation Wife's Father's Occupation

English Husband 33.6 Gentleman 5.6 Gentleman 7.5 Wife 33.0 Professional 8.2 Professional 2.6

Minor (< age 21) Husband 5.6 Merchant 18.4 Merchant 5.4 Wife 38.5 Army 1.5 Army 0.8

Literate Husband 70.2 Agriculture 10.5 Agriculture 6.0 Wife 70.4 Food 5.1 Food 1.7

Widow Husband 14.8 Leather 7.7 Leather 1.9 Wife 9.0 Manufacturing 6.6 Manufacturing 3.2

Children (from Husband 6.2 Service 3.7 Service 1.3 first marriage)* Wife 3.8 Shopkeeper 5.1 Shopkeeper 4.5

Catholic 71.5 Clothing 2.2 Clothing 0.8 Anglican 14.4 Construction 15.0 Construction 6.0 Other non-Catholic 14.1 Transportation 5.2 Transportation 2.6 1820s 45.2 Laborer 1.9 Laborer 2.4 1840s 54.8 Unknown 3.4 Unknown 53.3

Total 100.0 Total 100.0

* Unconditional mean (hence 42 percent of widowers mentioned children from their previous marriages). Notes: N = 533. See Appendix Table 1 for variable definitions. Source: Archives Nationales du Qudbec A Montrdal (hereafter ANQM).

(future) fathers-in-law.47 Overall, 20 percent of couples marrying in the parish of Montreal signed prenuptial contracts between 1823 to 1826. That proportion dropped to 10 percent in the 1840s.48 At least for Catholics, the decline occurred because men in all trades were less likely to sign contracts in the 1 840s, not because of change in the composition of husbands' occupations within the contracting population.49

Table 3 illustrates the incidence of property regime, annuities, and other widow support provisions in the contracts. Fifty-eight percent of couples retained community, and the rest rejected it.S? Most of those who chose community tinkered with its definition, but 29 percent did not adjust the way property was held during the marriage." Every couple, however, altered the

47 Among couples with known occupations (239 contracts), 22 percent of bride's fathers and grooms recorded the same occupation. In addition, 72 percent of husbands with a 'high' ranking occupation (army officer, professional, gentleman, or merchant) married a woman whose father was also of high rank. The same was true for women whose fathers had high ranking occupations (73 percent married men with a high ranking trade).

48 Bradbury et al., "Property," p. 15. 49Although this decline is very interesting, it is not the focus of this article. The decomposition of the

change in the rate ofcontracting is not included here (due to space considerations). It is available on request. 50 Eleven percent of couples choosing no-community rejected community but failed to declare their

assets "separate" (in this case everything belonged to the husband because he was the residual claimant). Fifty percent rejected community, declared their assets separate, and gave wives fuill administrative power over their own assets and earnings ( 'femme sole' status). The rest (39 percent) rejected community and separated their assets, while the husband retained administrative control over his own and his wife's assets.

51 Couples choosing community could augment or diminish the defmition of community property. For example, they could expand the definition of community by denoting their ancestral property part



84 Hamilton

TABLE 3 THE INCIDENCE OF PROPERTY REGIME, GIFTS, AND ANNUITIES (percentages)

All Community No-Community

N 533 307 226 No-community 42.4 0.0 100.0 Community 57.6 100.0 0.0 Inheritance advance (husband) 4.9 8.5 0.0 Inheritance advance (wife) 6.4 6.8 5.8 Gift from husband to wife 1.9 0.0 4.4 Gift from wife to husband 0.6 0.3 0.9 Annuity 91.7 97.1 84.5 Lifetime gift 49.7 80.1 8.4 Pure gift 11.4 16.0 5.3 Customary dower 0.4 0.0 0.9 No death support 4.5 0.6 9.7

Notes: Annuity is the incidence of support provisions-it equals one if the contract pledged either a prefixed dower,preciput, annuity, or lump sum payable during widowhood. Customary dower equals one if the couple did not rescind the dower (before 1841), or they reinstated it after 1841. It is a life interest in half the husband's ancestral assets. See Appendix Table 1 for other definitions. Source: ANQM.

default widow support provisions in some way (the customary dower before 1841; none afterwards). Virtually all contracts rejected the customary dower (one did not), and the vast majority replaced it with some form of annuity, depending on the property state.52 Roughly 90 percent of community contracts included an annuity, and 80 percent also adopted "lifetime gifts" (a lifetime gift gave the survivor use of all of the deceased's property-ancestral and community-during the survivor's lifetime)."3 In contrast, no- community contracts rarely specified lifetime gifts, but 86 percent promised the bride an annuity or a lump sum transfer if she was left a widow. The table also illustrates that a minority of contracts made note of parental gifts (akin to a dowry for women): overall, 6 percent of women and 5 percent of men mentioned that their parents gave them an advance on their inheritance. Spousal gifts were even rarer. In community contracts, there were almost none; in no-community contracts, 4.4 percent of men provided their brides with gifts (gifts from brides to grooms were very rare).

of the marriage community, or shrink the community by designating assets normally considered part of it as ancestral assets (such as furniture, money, or other real property they owned but did not inherit). Community was expanded in 15 percent, and diminished in 58 percent, of community contracts.

52 Only 4.5 percent of the contracts offered no extra financial support for the widow (some form of annuity, a lifetime or pure gift, or the customary dower).

53 This essentially delayed children's inheritance. Not all couples including this clause wished to delay their children's inheritance, though, and made this provision conditional on their being no surviving children. It also could be conditional on the survivor's continued widowhood. In some cases, couples opted for "pure" gifts, which gave the survivor outright ownership of all of the deceased's assets. This gift usually varied with the presence of children: if some of their children were alive at the time of a spouse's death, the survivor was entitled to an equal share of their spouse's property (if there were six children, they would each receive one-seventh). If there were no children, however, the survivor would receive the entire estate.




TABLE 4

WIDOW'S INHERITANCE-WITH AND WITHOUT A CONTRACT

No Contract Community Contracts No-Community Contracts

(1) (2) (3) (4) (5)

Assets Husband's earnings 1/2 1/2 +life (1/2) I 0 0 Wife's earnings l/2 l/2+life(l2) 1 0 1

Assets acquired during marriage V2 l2 +life (l2) 1 hers hers Wife's ancestral property 1 1 1 1 1 Husband's ancestral property life (l/2)* life (1) 1 0 0

Contract provisions Reject dower yes yes yes yes Lifetime gift** yes no no no Pure gift** no yes no no Capitalized annuity value*** - ?123.3 ?179.5 ?862.3 ?815.1

(237.4) (251.5) (1,065.4) (980.6) N 242 45 105 90

* This is the customary dower, which applied before 1841, thereafter her share is zero. ** Lifetime and pure gifts are assumed to hold only if there are no surviving children (sometimes they held regardless).

Capitalized annuity value is the capitalized sum of all dower or annuity provisions (prefixed dower, preciput, annuity, or lump sum provision), expressed in nominal Lower Canada pounds. Notes: Entries under 'assets' denote her share of the asset: zero = none; one = all; "hers" means those assets that belong to her (stipulated by receipt or inventory); "life (.)" means she has a lifetime claim on the specified share of the asset. Entries under "contract provisions" identify the average capitalized annuity value under different circumstances (standard deviations are in parentheses). "Yes" and "no" indicate whether the clause was present in the contract. N identifies the number of contracts with this combination of clauses.

For another view of the usual composition of terms, Table 4 reports the proportion of different types of assets a widow was entitled to without a contract, compared to four typical contracts-two community (the first with a lifetime gift, the second with a pure gift) and two no-community (assets are held separately in both, in the second the widow retains her earnings). For these examples, lifetime and pure gifts are assumed to apply only when there are no surviving children (the usual condition). Without a contract (column 1), the widow retained her ancestral property (in the table this is denoted by a one-indicating that she retains this entire asset), and claimed half the community assets (everything else). As noted, she was also entitled to her customary dower before 184 1-a life interest in halfher husband's ancestral property (marked "life (?2)" to denote the form of ownership and her share of the asset).

If a woman signed a community contract, with an annuity and lifetime gift (column 2), and the couple had children, she would inherit exactly as she would have without the contract, except that she forfeited the customary dower (before 1841), and received instead an annuity of ?7.4 (or in capital-



86 Hamilton

ized form, ?123-the average sum pledged under these circumstances).54 If none oftheir children were living at the time of her husband's death, she also would be entitled to lifetime use of all of her husband's assets-both his ancestral assets and his half of community. Hence under community assets, the phrase ''1/2 + life (?2)" denotes her half share plus her claim on her late husband's share of these assets. Therefore, she was almost certainly better off if no children survived (compared to no contract). If children survived, she was better off if the value of her annuity exceeded the value of the customary dower. This was certainly the case after 1841, when there was no customary dower, and the average pledge was ?1f1 1 (in lump sum, current dollar, form).55 Under a no-community arrangement where the wife did not own her earnings (column 4), she gave up her half of the community assets (leaving her with no claim on her husband's assets, hence a zero im the husband's earnings row), and took instead those assets marked as her own ("hers" in the table). In most cases, she also received an annuity or lump sum payment that averaged ?862 (in capitalized form).

The Incidence of Contracting

The design of community contracts concurs with one of the model's predictions: a principal reason for signing an agreement that did not alter the default property state (retained community) was to offer the bride more than she would have received in the absence of a contract. Were these women exceptional, as predicted? While it is not possible to determine this directly because data on brides' attributes (such as father's trade and signature rates) have not been compared'for the manying and contracting populations, such a comparison has been made for Catholic grooms. Bradbury et al. report that a disproportionate share of Catholic couples signing contracts hailed from high-ranking trades (compared to all Catholics marrying).56 For example, more than halfthe professionals, merchants, and gentlemen marrying at this time penned a prenuptial agreement, compared to a very small proportion of laborers. Given the positive correlation between groom and bride's father's

54 This is the capitalized sum of all financial commitments payable on the husband's death, convert- ing annuities to lump sum equivalents using an interest rate of 6 percent (the rate used in virtually all contracts specifying an interest rate). All of the sums are expressed in nominal currency ('current money of the province' or Halifax pounds). The exchange rate between currencies was: ?1 = 24 (livres ancien cours) = 4 (piastres or piastres d'Espagne) = ?0.18.0 Sterling.

55 By way of comparison, atypical Montreal boy signing a contract inthe 1830s received about ?10 annually from his master for room and board, and an additional ?3 per year for clothing (Hamilton, "Decline"). The data have not been deflated because no consumer price series is currently available for early-nineteenth-century Montreal, or Canada. A number of American indices, however, reveal that prices declined between the 1820s and 1840s. One consumer price index, based on urban prices, shows an 18 percent decline in prices over this period. See U.S. Bureau of the Census (Historical Statistics, Series E, pp. 135-66).

56 Bradbury et al., "Property."




occupations, brides (and grooms) signing contracts were relatively wealthy, and hence relatively desirable, spouses.

Marriage Attributes and the Optimal Property Regime

Summary statistics for the incidence of no-community contracts are reported in the "percentage no-community" column in Table 5. Overall, 42.4 percent of couples rejected community, 30 percent in the 1820s, and 53 percent in the 1 840s. The proportion choosing no-community appears to have been higher among high-income trades, although this might reflect differences in the ethnic composition across occupations. This is relevant because couples' choice diverged along ethnic lines-88 percent of anglophones rejected community, compared to 20 percent of francophones. The distinction is even more striking when mixed marriages are excluded: 96 percent of anglophone couples (all but one) chose no-community, compared to 19 percent of francophone couples. Hence it appears that couples may have chosen property states they found relatively famlliar. This does not imply that efficiency or moral hazard considerations were irrelevant, however, because the minority of couples that sought contracts do not appear to have been drawn randomly from the ethnic populations.

The hypothesized reasons for signing no-community contracts depend on the nature of marriage goods and the relative attributes of spouses. Recall, for example, that no-community is expected to have been a superior property state when husbands were relatively more productive at nonleisure activities than their wives, or when joint production was fairly unimportant. To account for this, personal attributes such as husband's occupation (controlling for wife's father's trade), as well as his relative literacy, are considered proxies for husband's comparative contribution to the household.57 Hus- band's occupation will also proxy for the expected importance ofjoint production because the contracts do not contain information that allows us to measure this aspect of expected joint production directly. Women's contribution in some trades is difficult to rank, but the extremes are fairly well established. For example, wives generally are considered to have made substantial contributions in trades such as farming, inn- or shopkeeping, and the needle trades (clothing, as well as upholstering and some of the leather trades such as shoemaking).58 Their contribution likely was more circumscribed in cases where men such as merchants, lawyers, and laborers performed work that was separate from home or involved specific knowledge. Children were also important contributors in farming and other 'family' businesses. Occupation is clearly a blunt measure of joint production, in part

57 Direct evidence on husbands' and wives' relative value in the marriage market is obviously difficult to obtain, in part because each party's assets at the time of marriage were not enumerated.

58 See, for example, Goldin, "Economic Status"; and Young, "Getting Around."



88 Hamilton

TABLE 5

AVERAGE

CAPITALIZED

ANNUITY

VALUE,

BY

PROPERTY

REGIME

AND

THE

INCIDENCE

OF

NO-COMM1UNITY

(NC)

Sample

and

Couple

Characteristics

Husband's

Occupation

Wife's

Father's

Occupation

Percentage

Percentage

Percentage

C (?)

NC (?)

NC

C (?)

NC (?)

NC

C (?)

NC (?)

NC

ALL

138.5

764.7

42.4

Gentleman

221.9

808.8

86.7

349.1

1,605.8

50.0

English

H

286.6

836.0

87.7

Professional

477.4

788.5

70.5

412.5

1,682.3

85.7

W

226.8

823.4

88.1

Merchant

289.4

1,040.1

71.4

316.7

1,179.6

79.3

Minor (<

age

21)

H

99.6

500.0

13.3

Army

1,916.7

100.0

1,100.0

100.0

W

148.7

797.3

31.7

Agriculture

103.4

195.1

16.1

81.2

621.3

28.1

Literate

H

178.3

793.5

57.8

Food

228.6

250.0

11.1

153.5

1,833.3

11.1

W

187.0

817.7

53.6

Leather

71.7

755.0

12.2

129.5

343.3

30.0

Widow

H

75.4

595.1

35.4

Manufacturing

85.9

500.0

17.1

182.3

345.4

52.9

W

138.7

366.7

33.3

Service

185.7

462.8

65.0

229.7

638.9

42.9

Children

(from

first

H

89.9

440.5

21.2

Shopkeeper

108.7

818.7

63.0

284.6

775.8

45.8

marriage)*

W

116.8

327.8

15.0

Clothing

206.4

420.8

66.7

131.3

1,000.0

50.0

Catholic

130.6

654.3

22.0

Construction

104.9

270.1

21.3

110.2

268.8

25.0

Anglican

197.5

1,014.5

93.4

Transportation

54.4

183.3

10.7

88.9

716.7

14.3

Other

non-Catholic

650.0

645.5

94.7

Laborer

24.2

550.0

20.0

118.5

631.7

30.8

1820s

146.6

793.8

29.9

Unknown

58.3

255.6

50.0

104.7

511.8

40.5

1840s

128.5

751.1

52.7

Inheritance

advance

H

67.3

-

0.0

Inheritance

advance

W

152.5

1,822.2

38.2

Pure

gift

173.2

405.0

19.7

Lifetime

gift

122.9

288.5

7.2

Notes:

Capitalized

annuity

value is the

capitalized

sum of all

financial

provisions

(prefixed

dower,preciput,

annuity, or

lump

sum

provision),

expressed in

nominal

Lower

Canada

pounds. H =

husband; W =

wife.

NC =

no-community; C =

community.

See

Appendix

Table 1

for

other

defmitions.

Source:

ANQM.




because of heterogeneity within the trade categories used here, but also because of the difficulties in distinguishing a joint-production from a relative-value (u / v # 1) motive for adopting no-community. In addition, widow status is hypothesized to proxy for joint production because the marriage goods were very different, for example, for widowers with children compared to males marrying for the first time.

To help isolate the different factors influencing couples' property state decision, the incidence of no-community (NC) is modeled as a fuiction of male and female attributes (occupation, literacy, religion, widow status, and ethnicity), as well as a time dummy variable

NC=a+biTiH+XiTiW+yYR+e (1)

where TiH and Ti' denote the i trait of the husband (H) and wife (W) respectively, and YR is the time-period dummy variable, equal to one for contracts signed in the 1 840s. The results of estimating the equation (as a logit) are reported in Table 6. Two versions are presented, one with the entire sample (column 1), and one that omits anglophone couples (leaving francophone and mixed marriages, column 2). The second version is included because anglophone couples almost uniformly chose no-community, and it is possible that an ethnicity dummy variable may not pick up all of the effects of this sorting.

The results in both specifications are consistent with the hypothesis that couples in which men's outside value exceeded their brides' (u / v < 1) should have chosen no-community. First, men in potentially less lucrative trades (controlling for wives' father's occupation) were less likely to reject community than merchants (the omitted category). Second, literate men, controlling for women's literacy, were more likely to opt for no-community. Although not part of this regression analysis, it is also notable that a disproportionately larger share of husbands who were of 44higher class" than their wives (mea- sured by the husband's occupation compared to the wife's father's occupation) chose no-community (60 percent, compared to 45 percent overall).59

59 'Higher class' means that the husband was a gentleman, professional, army officer, or merchant, or the wife's father was in those categories, and that the spouse (or her father) was not. 'Same class' included both classes (high and not high). Many contracts did not include the bride's father's occupation, and some did not report the husband's trade. The statistics reported here exclude those cases. Regression analysis confirms that the probability of choosing no-community is significantly higher (at the 1 percent level) for 'husband higher class' compared to 'same class' couples (class dummy variables-husband higher class and wife higher class-were regressed on the incidence of no-community).

Community No-Community Total Percentage Percentage Percentage Number

Husband higher class 40 60 100 40 Wife higher class 74 26 100 23 Same class 56 44 100 176 Total 55 45 100 239



90 Hamilton

In addition, while it is diffilcult to isolate the importance ofjoint production with a reduced form specification, some support for this hypothesis does seem to exist. Trades in which joint production is thought to have been important tended to opt for community. For example, francophone farmers, shop keepers, and leather tradesmen (colunm 2) were all less likely than merchants to reject community. Furthermore, even within couples choosing no-community, farmers appeared the least interested in separating their assets-they were less likely than others to explicitly declare their premarital and marital debts separate.60

Table 6 also reveals that widowers with children were more likely to retain community; whereas widows with children were less likely to do so (the precision of the latter result changes across samples, but the sign is consistently positive).6" As stated earlier, widowers and widows were expected to have been less desirable spouses, all else equal. This alone will not have affected the optimal property choice, however, unless they are consistently expected to have married someone with a higher outside value (in which case no-community would have been superior). In light of this, it seems plausible that the property choices of people with children were influenced by the fact that their marriage goods were markedly different. A widower with young children may have been particularly interested in ensuring that his new wife raised his children and treated them well. A community arrangement may have best appealed to the bride's sense of shared responsibility and provided her with more appropriate incentives. A widow with young children faced different circumstances, though, because she was largely responsible for raising her children. A no-community contract may have provided a potential groom with the necessary enticement for marriage-he would not have to share the income generated from his work with her existing children and she could pass on her separate assets to her (first marriage) children. Hence a no-community arrangement allowed a couple more flexibility to overcome the competing interests of their different sets of children, with the added enticement of providing the husband with all of the return on marginal units of effort he devoted to nonleisure activities.

60 Couples rejecting community could opt to hold separately their debt accumulated before and after marriage (in addition to their assets). The probability of debt separation (within no-community contracts) was regressed on an 1840s dummy variable, personal characteristics, and the husband's craft. Farmers were less likely than others to include a clause in their contract stating that they would separate their debts. This was the only significant craft effect. Only no-community contracts where assets were held separately (almost all of them) were included in the regression because debt separation was not an option in no-community contracts that did not explicitly separate their assets. These results are available on request.

61 In addition, couples were more likely to reject community in the 1840s. This effect may reflect selection bias-only the wealthiest couples tended to sign contracts and fewer couples (possibly a more select population) signed contracts in the 1840s.




TABLE 6 LOGIT ESTIMATES OF THE PROBABILITY OF REJECTING COMMUNITY

Full Sample Francophone and Mixed Couples (1) (2)

Independent Variables Coefficient SE Coefficient SE

Husband's Occupation Gentleman 0.43 (0.81) 0.38 (0.93) Professional -0.59 (0.59) -0.73 (0.66) Army 33.22 (0.2E+08) Shopkeeper -0.98 (0.73) - 1.66* (0.90) Service 0.10 (0.73) -0.29 (0.79) Unknown -0.34 (1.12) -1.18 (1.53) Manufacturing -3.01*** (0.81) -34.17 (0.IE+07) Laborer -1.89 (1.22) -32.96 (0.2E+07) Construction -1.90*** (0.59) -2.80*** (0.69) Agriculture -1.16 (0.67) - 1.67** (0.75) Transportation - 1.92** (0.92) - 1.90* (0.97) Food -4.04*** (1.16) -32.87 (0.lE+07) Leather -1.93** (0.82) -2.52*** (0.94) Clothing -0.08 (0.87) 0.25 (0.95)

1840s 1.85*** (0.39) 2.44*** (0.49) Anglican 2.21** (0.85) 0.58 (1.23) Other non-Catholic 2.37*** (0.89) 35.39 (0.7E+07) Minor (H) -1.33 (1.01) -2.24 (1.45) Minor ( W) -0.39 (0.39) -0.65 (0.45) Literate (H) 1.32** (0.51) 1.00* (0.57) Literate (W) 0.18 (0.43) 0.16 (0.50) English (H) 0.72 (0.59) -0.55 (0.73) English (W) 1.82*** (0.55) 1.17 (0.83) Widow (H) 1.08** (0.48) 1.50*** (0.54) Widow (VY) -0.86 (0.70) -2.62** (1.21) Children (H) - 1.63* (0.87) - 1.69* (0.96) Children (W) 0.33 (1.15) 2.24 (1.59) Constant -2.68*** (0.72) -2.55*** (0.82) LLF -144.74 -106.65 N 533 379 * = Significant at the 10 percent level. ** = Significant at the 5 percent level.

= Significant at the 1 percent level. Notes: The dependent variable is a dummy variable equaling one if the contract rejected community. The numbers in parentheses are standard errors. H = husband; W = wife. LLF = Log of the Likelihood Function. Version 1 consists of the full sample (N = 533); the second excludes marriages between anglophone spouses (where both spouses were anglophone). Occupation dummy variables for the wife's father were included, but not reported. In the full samnple (1), none of these occupation effects were significant. In the restricted sample (2), the coefficient on labor and professional were significant (at the 5 and 10 percent levels, respectively). The coefficient on labor was +3.67 (1.45); on professional it was +1.77 (1.01). See Appendix Table 1 for variable definitions. Source: ANQM.

Annuities

Following the transaction cost approach, the capitalized annuity value (the sum of all cash transfers specified in the contract, A) is expected to have



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varied with the property regime (and other contract terms), as well as the bride's and groom's attributes

A = ao + aiTiH +A3TiW + 6YR + yC + e (2)

where TiH denotes the il trait of the husband, and Til defmes the same trait for the wife (traits include literacy, age (over 2 1), widow status, ethnicity, inheritance advances, and occupation); C is a vector of contract terms, such as the property regime and the presence of lifetime support; YR is a time-period dummy variable; and e is the error term.62 The contract terms (C) are potentially endogenous regressors, so they are included in only some of the specifications.

The value ofA is expected to vary positively with women's outside value (u). Some of the variation in u is proxied by dummy variables for a woman's ability to sign her name, her father's occupation, and the presence of an inheritance advance. Inheritance advances indicate that the bride brought wealth into the marriage, and thus added more to the couple's wealth than the same inheritance obtained when the parents died. Brides' outside value also would have been higher if they were generally scarce.63 In Montreal at this time, the ratio of men to women in the adult population appears to have been fairly equal (in 1825 it was about one to one), and a bit below one in the 1 840s. By 1844 there were 95 men for every 100 women at the county level.4' Hence the year dummy variable may pick up this small increase in the relative supply of women in the 1 840s (which should depress the average capitalized annuity).

62 Rao ("Rising Price") regresses marriage payment values on a vector of bride and groom's characteristics, as well as a sex-ratio variable, to explain intertemporal changes in dowry values in India. She differences attributes to take account of assortative mating. Differencing is not feasible here, however, because of the nature ofthe wealth measure (a series ofoccupation dummy variables) and the relatively small sample size. The main concern with not differencing the data is multicollinearity, which can make it difficult to isolate the effects of particular variables on the annuity value.

63 There is a large literature on the relationship between sex-ratios and marriage markets. South and Trent, "Sex Ratios"; South and Lloyd, "Marriage Opportunities"; and Billig, "Marriage Squeeze," are examples of sociological studies. Jack Goody, Oriental; Betzig, Human Reproductive Behaviour; Betzig, Human Nature; BorgerhoffMulder, "Kipsigis Women's Preferences"; and Gaulin and Boster, "Dowry," offer anthropological perspectives. Becker, Treatise; Bergstrom, "Economics in a Family Way" and "On the Economics"; and Grossbard-Shechtman, Economics, offer economic viewpoints.

I This decline may have been caused by an out-migration of males following the cholera epidemics of 1832 and 1837 and the 1837/8 uprising (most migrants were male). Census of Canada, 1870-71, Vol. 4. Current studies of marriage markets focus on ratios defined according to the local conditions. All studies omit people over (roughly) age forty. For example, studies on India's marriage market use males aged 20 to 29 relative to females aged 10 to 19 (Rao, "Rising Price"; and Billig, "Marriage Squeeze"). South ("Marriage Opportunities" and "Sex Ratios") uses the number ofpeople between ages 15 and 49. A more narrowly defined age category for either the 1825 or 1844 census is not possible because of large differences in the age groupings across males and females. Notably, there have been some detailed examinations of Quebec's demographic history and marriage market that draw on well preserved and complete parish registers. These studies have focused on the ancien re'gime (before 1761). See, for example, Bouchard, "Transmission"; Henripin, Population; Henripin and Peron "Demographic Transition"; and Landry, "Gender Imbalance."




Stronger elements of gender scarcity appear to have existed within certain segments of the population. For example, a large number of female domestics who were disproportionately poor were drawn into the city from the surrounding area, hence the number of available rich men likely exceeded the number of available rich women. In addition, there were large differences in the sex ratio (males per 1 00 females) across ethnic groups. In 1825, for example, the sex ratio was 92 for native-bom francophones, 97 for native-bom anglophones, and 11 7 among the largely anglophone immigrant population. This is atypical phenome- non among imumigrant populations, because most tended to be male. Thus potential brides were likely scarce within the anglophone population, and single, wealthy women may have been somewhat scarce. Conversely, males may have been somewhat scarce among francophones. Ethnic dummy variables may capture these differences in gender scarcity.

It is expected that the level of fimancial support (A) varied inversely with the presence of other types of support, such as lifetime gifts and half the community. Because such factors as the size of community depended in part on a husband's income, it is also important to control for their attributes. Variations in support in community and no-community contracts are exam- ined first separately and then together. Because of the regime split along ethnic lines, it is useful to examine within-regime variation in annuities to better determine whether anglophones paid higher support in response to the scarcity of English females (all else the same). Examining variation in support across all contracts will shed light on the variation in support across regimes, and help determine whether women in the no-community regime appear to have been compensated for the loss of community.

Estimates of the annuity function (equation 2) within property regime are reported in Table 7 (summary statistics for the capitalized annuity value are presented in Table 5). Within each regime, two versions are presented. In the second, the potentially endogenous regressors (lifetime and pure gifts) are included. First, there are clear wealth effects captured by the husband's- occupation or wife's-father's-occupation dummy variables. In the no-community contracts, these effects are picked up largely by the wife's-father's- occupation dummy variables. For example, when the controls for lifetime and pure gifts are included, husbands in only a few trades (agriculture, construction, and service) offered significantly less than merchants (between ?320 and ?525), and most daughters received smaller capitalized annuities than women whose fathers were called gentlemen (in the neighborhood of ?1,000 less). It is also evident that controlling for variation in the other characteristics, women who could sign their names received more support. This may have been a particularly scarce, valued attribute. In addition, couples appeared to treat some types of support as substitutes, as expected. Contracts that included a lifetime gift, for example, offered smaller annuities, regard-



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TABLE 7 DETERMINANTS OF THE ANNUITY VALUE

Community No-Community

Independent Variables (1) (2) (3) (4)

Husband's Occupation Gentleman -107.3* -108.7 -125.6 -113.8

(63.4) (67.1) (220.5) (220.7) Professional 164.8 157.9 -79.2 -73.8

(100.4) (96.7) (199.1) (199.9) Army - 445.6 539.7

(715.8) (748.6) Shopkeeper -112.0** - 116.4** 131.3 148.6

(52.6) (51.1) (248.3) (245.3) Service -81.8 -107.0 -377.8** -388.8**

(81.4) (70.9) (182.2) (178.9) Unknown -121.9** - 151.7** -402.2* -383.8

(56.3) (60.5) (239.9) (243.3) Manufacturing -171.3*** - 166.9*** -311.6 331.7

(48.1) (47.1) (206.5) (207.3) Laborer -206.9*** - 186.9*** 314.5 332.1

(56.6) (60.5) (327.3) (321.2) Construction - 138.9*** - 148.0*** -397.9** -320.4*

(45.7) (45.5) (190.2) (191.3) Agriculture -115.8** - 127.4** -470.6** - 524.5*

(51.4) (49.7) (223.2) (212.2) Transportation -181.2*** - 180.9*** -261.5 -291.1

(48.2) (47.6) (248.7) (242.7) Food -33.7 -33.7 -259.2 -259.3

(118.2) (117.4) (276.5) (275.4) Leather - 184.4*** - 190.7*** 217.0 313.6

(49.3) (47.4) (300.3) (287.5) Clothing -56.2 -25.6 -331.7** -256.6

(125.6) (121.3) (166.6) (165.9) Inheritance advance (W) 44.3 54.4 471.1 460.5

(42.7) (41.8) (460.0) (462.8) Inheritance advance (H) -68.6** -60.7*

(32.0) (32.1) 1840s 6.1 2.3 -92.2 -77.7

(33.2) (33.1) (143.9) (149.9) Anglican -137.8 -212.1** -173.4 -161.5

(96.4) (98.2) (391.6) (385.1) Other non-Catholic 347.7*** 261.8* -394.6 -403.4

(134.5) (138.7) (328.8) (326.4) Minor (H) -3.1 5.6 -238.9 -182.7

(30.1) (30.3) (212.1) (239.3) Minor (W) -0.07 -4.1 -137.7 -148.1

(28.3) (27.1) (195.5) (194.9) Literate (H) -30.5 -31.5 99.0 -35.0

(37.8) (37.8) (203.2) (215.5) Literate (W) 47.4* 46.5* 230.7* 264.1**

(27.2) (26.9) (122.0) (118.0) English (H) 75.9 52.4 312.5 265.8

(62.0) (52.0) (246.0) (238.8)




TABLE 7-continued

Community No-Community

Independent Variables (1) (2) (3) (4)

English (W) - 10.8 - 16.2 45.7 36.7 (64.9) (61.5) (212.2) (210.0)

Widower (H) -44.8* -86.9** 198.4 161.5 (24.2) (34.7) (223.3) (224.8)

Widow (W) 22.6 1.2 -327.1** -319.7** (45.2) (37.9) (129.2) (125.8)

Children (H) -4.3 -45.1 - 578.2* -467.8 (34.5) (48.3) (301.2) (298.7)

Children (W) 17.3 -24.9 392.9 332.8 (62.5) (60.5) (346.1) (331.6)

Wife's Father's Occupation Professional -96.1 -94.2 14.3 -13.5

(176.1) (178.9) (483.7) (487.2) Army - -715.8 -745.6

(677.2) (685.8) Merchant -34.1 -52.4 -548.7 -531.1

(166.2) (153.2) (433.1) (432.1) Shopkeeper -93.1 -104.0 -770.0* -688.6

(165.6) (165.2) (438.6) (430.4) Service -72.4 -74.2 - 1,257.0* - 1,305.4*

(141.4) (141.3) (748.6) (759.1) Unknown -190.9 -196.0 - 994.9** - 971.9**

(139.8) (139.3) (401.7) (398.3) Manufacturing -123.1 -127.7 - 1,023.5*** - 1,018.4***

(155.1) (155.0) (345.2) (346.5) Laborer 152.7 -157.4 - 996.7** - 1,011.8**

(138.9) (138.8) (450.4) (457.6) Construction 228.1 -234.1 - 1,108.6*** - 1,044.0***

(150.1) (149.3) (388.9) (389.7) Agriculture -223.5 -232.8 - 814.4* - 799.2*

(148.5) (147.7) (431.9) (432.0) Transportation -191.9 -199.5 - 791.6* * - 682. 0*

(153.2) (153.3) (389.7) (369.5) Food -147.5 -166.8 261.8 239.0

(140.8) (141.5) (369.8) (376.2) Leather -172.0 -186.8 1,158.7** -1,057.6

(128.5) (129.8) (475.4) (507.8) Clothing -191.3 -192.6 -779.2 -702.5

(127.7) (128.1) (571.4) (580.1) Pure gift 27.8 -235.7

(58.7) (177.8) Lifetime gift - 105.4** -306.9**

(52.4) (129.5) Constant 406.3*** 519.1*** 1,379.5*** 1,513.4***

(136.1) (141.2) (401.7) (534.5) N 307 307 226 226 R2 0.28 0.30 0.30 0.31 Adjusted R2 0.17 0.18 0.14 0.14 * = Significant at the 10 percent level.



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TABLE 7-continued ** = Significant at the 5 percent level.

= Significant at the 1 percent level. Notes: The method ofestimation is OLS. The dependent variable is the capitalizd annuity value. The numbers in parentheses are standard errors. A heteroscedasticity-consistent covariance matrix was employed (White corrected standard errors). H = husband; W = wife. See Appendix Table 1 for variable definitions. Source: ANQM.

less of the property regime. Pure gifts were an exception-contracts with this provision did not offer less fiancial support. This suggests that, all else the same, these contracts contained more support in total (these gifts were almost exclusively the domain of widows and widowers). Finally, annuity values within both community and no-community contracts were not (significantly) different in the 1820s and 1840s. This suggests that the average outside value of women signing contracts did not change markedly, at least in nominal terms, between the 1820s and 1840s.

The ethnicity dummy variables in the no-community sample (the scarcity proxies) are imprecisely estimated. These dummy variables pick up only the average return to ethnicity, however, and not the marginal return to scarce attributes. To determine whether anglophone women were able to exploit their relative scarcity (compared to francophone women), interactlons were added between individual characteristics (literacy and widow status) and ethnicity.65 Table 8 reports results for the interaction effects. They indicate that literate anglophone women were able to extract significantly higher support than literate francophone women. The point estimate of the francophone premium is about ?57, whereas the anglophone premium is ?532 (?57 + ?477). In addition, anglophone widowers paid more support ?755 (-?34 + ?789) than francophone widowers (-?34). These results suggest that anglophone women with desirable attributes extracted higher annuities, and anglophone men with undesirable traits paid more than their francophone counterparts.

Pooling the samples (and adding a dummy variable for property regime) allows us to determine whether the average annuity varied by regime, all else the same (including dummy variables for husband's and wife's father's occupations, for example, helps to take account of the fact that more high- income individuals chose no-community). The results of these regressions (not reported here) indicate that the average annuity was significantly higher in no-community contracts. Without including the lifetime and pure gift contract terms as regressors, the no-community annuity was ?324.20 higher; with these contract terms, the average no-community payment was ?170.55 higher than otherwise (all significant at the 1 percent level). While it is not possible to determine whether these pledges adequately compensated women

65 Interacting ethnicity with each of the occupation dummy variables is clearly suggested by the results, but the cell sizes are too small to allow for meaningful results.




TABLE 8 ANNUITY VALUES: ETHNICITY INTERACTIONS FOR THE NO-COMMUNITY SAMPLE

Independent Variables Coefficient SE Independent Variables Coefficient SE

English (H) 37.2 (361.8) Literate (W) x English (W) 477.0** (234.6) English (W) -378.4 (238.8) Widower (H) -34.4 (196.6) Literate (H) 219.0 (187.5) Widower (H) x English (H) 788.9** (334.0) Literate (H) x English (H) 147.9 (294.6) Widow (W) -217.0 (284.8) Literate (W) 57.3 (149.8) Widow (W) x English (W) -142.4 (312.6)

** = Significant at the 5 percent level. Notes: N = 226. The method of estimation is OLS. The dependent variable is the capitalized annuity value. The numbers in parentheses are standard errors. Not all results are reported; the specification is the same as in Table 7, column (3). A heteroscedasticity-consistent covariance matrix was employed (White corrected standard errors). H = husband; W = wife. Source: ANQM.

for- the loss of community, they do indicate that women in no-community contracts received higher annuities.

IMPLICATIONS

In this article I have sought to provide a framework for evaluating and understanding the decision to sign a prenuptial contract and people's contractual choices. The analysis not only helps us better understand these particular agreements, but also reveals something of the efficacy of marital property laws in early-nineteenth-century and contemporary North America.

Couples signing contracts in Quebec were relatively well-to-do, although not all were exceptionally wealthy as one in every six couples signed such a document. Women in these documents appear to have been relatively sought after: most women were pledged more income than they would have been assured without a contract, and women with scarce, desirable attributes (literate and anglophone women, for example) received relatively large annuities. Regarding property choice, couples with men in trades that likely required less direct involvement from their wives, as well as widows with children and literate men, tended to opt out of community. On the other hand, those in situations where the potential benefits from joint participation in either raising children or a family business were particularly large-notably fanners and widowers with children-disproportionately retained community.

These fmdings have implications for optimal property laws, the distribution of wealth, and economic growth in societies where women's market opportunities are limited. Quebec's unique legal institutions offered the opportunity to draw up a prenuptial contract to couples who could benefit from a different property structure than the law provided. Not surprisingly, a prenuptial contract was unnecessary for most couples. Within this transaction cost-competitive marriage market framework, contracts generally were



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desirable only in cases of mismatch, either due to an exceptional woman or a relatively productive husband whose job did not entail a significant com- ponent of family participation. Their contracting decisions are consistent with terms that would have provided them with more appropriate incentives for work and the production ofjointly produced goods, and at least the potential for greater utility and wealth than they otherwise would have accumulated. The use of contracts likely provided Quebec with higher overall wealth and a wider income distribution than it would have experienced without contracts (because the skilled disproportionately signed agreements).

In a society with English-based, no-community property laws and no prenuptial contracts (such as in most of North America), families where joint production was important were likely worse off than they would have been with access to contracts.56 A sharing arrangement might have provided these wives with a stronger incentive to participate in the production of marriage goods.67 Couples with husbands in relatively lucrative occupations such as merchants and lawyers, on the other hand, likely would not have benefited as often from contracts (because they would have adopted a no-community regime anyway, given the choice). Thus better access to prenuptial contracts in common-law American society might have raised the general level of wealth and dampened the distribution of income by raising the prospects ofpoorer people that might have adopted community contracts (such as fanners), and leaving the circumstances ofthe rich (merchants and professionals) unchanged.

More generally, without widespread contracting (where contracting costs were high), there would have been greater incentive for individuals to find a mate with similar attributes. Hence we should observe more matching and possibly a longer search time (higher age at marriage). Furthermore, societies with community property laws may have favored and encouraged joint production (hence investment in children and businesses that required joint activities), whereas no-community societies where husbands were the residual claimant encouraged men to adopt professions in which their wives' contribution was- less important-more often high-income professions. In addition, the return on women's human capital investment was likely higher in community environments, because their effort may have been better re- warded and the 'reward' was known at the time of marriage.

With more study, these conjectures may help to explain a few puzzling features of early Quebec's society. First, Quebec farmers are often considered to have been somewhat 'backward' in their production techniques. The community property regime in Quebec may have encouraged families' self-

66 There is a large literature on the poverty of widows. See, for example, Hufton, Prospect; and Wilson, Life.

67 This is not to suggest that farming wives did not work very hard, but that some may have made more productive use of their time if they knew from the time of their marriage that at least half the estate belonged to them.




reliance and thereby impeded the adoption of methods of production (or occupations) that relied less on family labor and more on mechanized, large- scale production techniques.68 Second, Quebec women tended to have higher literacy rates than men, whereas the reverse was true in the rest of North America. Thus whether English North American society would have been better off in the nineteenth century if its property laws were more like Que- bec's laws (or changed earlier) clearly depends on one's perspective.

68 McCallum, Unequal Beginnings. There is a debate on the existence of productivity differences in Quebec and Ontario agriculture. A summary can be found in Norrie and Owram, History. See also Lewis and McInnis, "Efficiency." Di Matteo ("Detenninants," p. 909) discusses wealth and asset differences between Quebec and Ontario, and reports that the incidence and level of fmiancial asset holdings was higher in mid-nineteenth-century Ontario.

APPENDix TABLE 1

DEFINITIONS

Variable Defmition 1840s 1 = contract signed in 1840s. English 1 = individual had an English name. Catholic 1 = couple married in a Catholic church. Anglican 1 = couple married in an Anglican church. Other non- 1 = Presbyterian, Protestant, Baptist, Methodist, Unitarian, or Congregational

Catholic church, Jewish synagogue ; or unknown (1 case). Widow 1 = spouse widowed (at least once). Minor 1 = spouse is below the age of 21. Literate 1 = spouse signed his or her name. Children 1 = individual noted in the contract children from a previous marriage. Occupations 1 = if husband or wife's father indicated the relevant occupation. Gentlemen Bourgeois, esquire, gentleman, seigneur. Professional Notary, justice of the peace, judge, attorney, student of law, doctor, student

doctor, surgeon, veterinary surgeon, reverend, member of legislative council, surveyor, architect, professor, accountant.

Merchant Forwarder, merchant, marchand a' commission, banker, ironmonger. Army Captain, ensign, lieutenant-colonel, lieutenant, general, army surgeon. Service Peddler, huckster, clerk, druggist, barber, printer, inspector (engineer, wood

measuring, flour), commissariat d'issue, guard (court house), bailiff, post master, sheriff, journalist, auctioneer.

Shopkeeper Innkeeper, tavernkeeper, shopkeeper, grocer, spice merchant, hardware merchant.

Unknown No occupation given. Manufacturing Tinsmith, blacksmith, gunsmith, watchmaker, jeweler, gold or silver smith,

sculptor, molder, cabinet maker, carriage maker, furniture maker, wheel- wright, and cooper.

Laborer Laborer, sawyer, basketmaker, verger, refectorier. Construction Builder, carpenter, joiner, menuisier, ship's carpenter, contractor, mason, painter,

plasterer, plumber, millwright. Agriculture Farmer, gardener, yeoman. Transportation Carter, pilot, navigator, voyageur. Food Baker, pastry maker, butcher, brewer, miller, snuff manufacturer. Leather Shoemaker, saddler, tanner. Clothing Furrier, tailor.



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APPENDIX TABLE 1-comtinued

Variable Definition

Inheritance 1 = spouse received an advance on his or her inheritance from his or her parents. advance

Gift (spousal) 1 = individual (or parents) gave their spouse a gift-usually cash, sometimes lodgings or a home.

Capitalized The sum of all cash provisions: prefixed dower, preciput, lump-sum payment, annuity and annuity, converted to a lump sum, using an interest rate of 6 percent, and value expressed in nominal 'current money of the province', or Halifax pounds.

Exchange rate: ?1 = 24 livres ancien cours = 4 piastres d'Espagne =

?0.18.0 sterling. No death 1 = contract contained no fmancial support or in-kind support and dower was

support renounced. Lifetime gift 1 = contract contained a lifetime gift (either mutual or one-way). Pure gift 1 = contract contained a pure gift.

REFERENCES

Allen, Douglas. "What Does She See in Him?: The Effect of Sharing on the Choice of Spouse." Economic Inquiry 30, no. 1 (1992): 57-67.

. "Marriage and Divorce: A Comment on Peters." American Economic Review 82, no. 3 (1992): 679-85.

Allen, Douglas, and Dean Lueck. "Risk Preferences and the Economics of Contracts." American Economic Review 85, no.2 (1995): 447-51.

Alston, Lee, Samar Datta, and Jeffrey Nugent. "Tenancy Choice in a Competitive Frame- work with Transactions Costs." Journal of Political Economy 92, no. 4 (1984): 1121-33.

Alston, Lee, and Robert Higgs. "Contractual Mix in Southern Agriculture Since the Civil War: Facts, Hypotheses, and Tests." this JOURNAL 42, no. 3 (1982): 327-53.

Alston, Lee, and Morton Owen Schapiro. "Inheritance Laws Across Colonies: Causes and Consequences." this JOURNAL 44, no. 2 (1984): 277-87.

Backhouse, Constance. Petticoats and Prejudice: Women and Law in Nineteenth Century Canada. Toronto: The Osgoode Society, 1991.

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Property Rights and Transaction Costs in Marriage: Evidence from Prenuptial Contracts

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