In 1965, Daniel Moynihan asserted that unemployment, in general, and its interaction with the matriarchal structure of black families was a major cause of the “crumbling‘ of the Negro family. Moynihan did not address the relation of unemployment and marital instability in white families. This study examines the relationship between unemployment and marital instability in black and white families over the period 1970–1978. The theoretical framework emphasizes that the effects of unemployment on the family cannot be understood in purely utilitarian terms i.e. lost income. A socioeconomic model that incorporates both the social-psychological and psychological responses to unemployment is developed and the parameters estimated using Event History Analysis on a sample from the Panel Study of Income Dynamics for the years 1967–1979. Moynihan's main assertion that unemployment destabilizes families—both black and white—is confirmed. Also confirmed is Moynihan's assertion that families with a patriarchal head are less likely to experience marital instability. The results contradict some of the other predictions of the Moynihan hypothesis. First, black families are at less risk of marital instability at moderate levels of unemployment than are white families. Second, although black families appear to be more vulnerable than white families to chronic unemployment, the difference disappears when black males have only average scores on internal locus of control. When black males have above average scores on internal locus of control the risk of marital instability in the face of chronic unemployment is negligible. Third, while stabilizing for families where males who do not experience unemployment, patriarchal values prove quite destabilizing when the male head experiences unemployment. Indeed, the families facing the greatest risk of instability due to unemployment were white families headed by a man who had partriarchal attitudes. Fourthly, this study produced no evidence that black women are. behaviorally, more matriarchal than white women. Finally, this research indicates that the financial problems caused by unemployment appear to be a minor factor in martial dissolution. It appears that socioeconomic, that is, normative and affective factors, rather than utilitarian factors, are critical is shaping a family's reaction to unemployment.