I develop a model of marriage in which spouses decide on investments in child quality during marriage, and on the allocation of child custody should they divorce. The custodial allocation determines the share of the marital surplus each spouse appropriates, which in turn influences spouses'...

Merged firms are typically rather complex organizations. Accordingly, merger has a more profound effect on the structure of a market than simply reducing the number of competitors. We show that this may render horizontal mergers profitable and welfare-improving even if costs are linear. The...