The author develops a micro-model of marital interactions that is used to analyze factors affecting the divorce rate in modern industrialized societies. The core of the model is the concept of production of marital gain and mutual control of this production. "The increase of divorce rates, then, is explained by a steady decrease of institutional and social embeddedness, which helps to solve this kind of an 'assurance game.' The shape of the individual risk is explained by the typical form of change of the 'production functions' of marriages within the first period of adaptation. The inconsistent results concerning womens' labor market participation in linear regression models are explained as a consequence of the (theoretical and statistical) 'interaction' of decreases in embeddedness and increases in external alternatives for women." Comments are included by Karl-Dieter Opp (pp. 278-82) and Ulrich Witt (pp. 283-5).

"The aging of the industrialized countries will dramatically strain their social security systems. In Germany, for example, 100 employed persons now support about 40 elderly, but 85 elderly will have to be sustained by the same number of employed persons in the year 2030. This pressure is exacerbated by the observed trend towards earlier retirement ages. This paper presents cross-national evidence and an option value analysis of the retirement decision to argue that the distortions created by the actuarially unfair design of the social security systems in the United States and particularly in Germany have significantly contributed in this trend." (SUMMARY IN GER)