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Based on Wickelgren (2009), use the bargaining model introduced in the Lecture (split-the-surplus rule) to analyse the welfare effect of divorce laws. a) Does the
Based on Wickelgren (2009), use the bargaining model introduced in the Lecture ("split-the-surplus rule") to analyse the welfare effect of divorce laws. a) Does the "Consent Rule result in a lower divorce rate than the "Unilateral Rule from an ex- post perspective? [20% of marks] b) Pick one example each for a selfish and a cooperative investment (you may use examples suggested in the paper) within a marriage and compare the impact of the "Consent Rule" vis--vis the Unilateral Rule on the efficiency of investment incentives in both examples. [50% of marks] c) Briefly place the analysis in the wider context of other economic literature that applies the same theory. [30% of marks]
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