The Determinants of Household Break-up: A Case of a Developing Country

Firman Witoelar, Yale University

This paper investigates the underlying factors determining household break-up in Indonesia, utilizing data from three waves of the Indonesia Family Life Survey (1993, 1997, 2000). Borrowing the empirical approach suggested by Foster and Rosenzweig (2002), we estimate the probability of household break-up between the survey waves. The findings suggest that along with age composition, education plays an important role in determining household break-up. Education of the head and the maximum education of other household members are negatively and positively associated, respectively, with the probability of household break-up. These results, along with our findings on urban-rural differences indicate that household break-up in Indonesia may largely be associated with the mobility of the younger, more educated household members. The change in household structure as a response to economic shocks is also investigated. The paper contributes to our understanding of household formation and dissolution, which in most previous studies is treated as exogenous.