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An Economic Approach to Marriage

Marriages are not always very stable. A divorce rate of 50 % in developed countries serves to prove. We ask ourselves if it is possible to form stable relationships. An economic analysis may be able to answer this question.

Article also available in : English EN | français FR

Imagine 100 men and 100 women. Each participant has preferences regarding participants of the opposite sex, which take the form of a ranking [1]. Gale and Shapley [2] have shown that there are two algorithms which allow stable relationships to be formed. [3].

- In the first, all the women line up. Each man moves toward his first choice, whereafter each woman chooses the man that she prefers among her suitors. The rejected men therefore move towards their second choice. Each woman then takes turns to choose a man among their preferred men from the first round (if applicable) and her suitors from the second round, and so on and so forth. This arrangement is stable. In effect, a man knows that he could not have better, as all the women whom he would prefer to marry have already rejected him. This analysis suggests that it is preferable to meet single people of the opposite sex before getting married, rather than afterwards...

- The other algorithm that provides a stable situation is to line up the men, suggest that the women approach them and allow the men to reject the less desirable ones. Clearly the first algorithm corresponds more closely to reality... this is without consequence. The first algorithm is more favourable for the men, while the second is more favourable for the women. After all, to be with no regrets and in the best stable marriage possible, it is preferable to make the first step as soon as possible when one is single.

Each and every person should be able to find a suitable match. Yet, our society is leaning towards a balance portrayed in Sex and the City, in which highly educated women from a modest background and less qualified men find themselves forever single
Pierre Chaigneau

More fundamentally, why is marriage of interest to men and women?

Why does this same institution exist among so many different cultures? Gilles Saint-Paul [4] bases his analysis on two biological facts; therefore universal. Firstly, a man can have many more descendants than a woman. Secondly, without any contractual agreement (imagine ʻthe state of natureʼ) only women can be sure that a child is really theirs.

Women could choose to reproduce with only men with the best genes, but this restricted group would not necessarily have the means to support all the women and all the children. A woman would be typically inclined to reproduce with a man who is genetically less desirable if she is assured of his loyalty and financial contribution to the household, especially if this woman has limited financial means. Furthermore, most ʻnormalʼ men are inclined to support their offspring if they are sure that they are the parent.

Therefore, it is in the interest of most men and women to conclude a contract. In a wedding arrangement, the men are buyers - of fidelity - and the women are the sellers - they sacrifice the better reproductive partners for security. Therefore, wealthy men have more means to ʻbuyʼ (they bring more value to a marriage) while women with the lowest income have just as much of an interest to ʻsellʼ (they have even more of a need to get married in order to satisfy their family needs.)

In this marital market, women with the lowest income benefit more from a marriage. Consequently, they will be ready to make more sacrifices and compromises in order to get married. In other words, their offer will be relatively tempting. It is therefore possible that these women with lower incomes will benefit more than those with higher salaries and monopolize the men with better incomes. Yet women with higher earnings have no interest whatsoever in marrying men with lower earnings : the latter would bring only a meagre contribution to the household. These women stay single, as do the men with modest incomes, while the women of modest incomes and men with higher incomes will be more likely to form a union. It is the hypergamous balance portrayed in Sex and the City, the stronger the disparity of income, the more pronounced is this phenomenon.

Men are more likely to choose an education that will allow them to pursue lucrative careers. For women, not acquiring skills which are valuable in the workforce allows them to commit themselves to finding a companion. This could possibly explain why parents who would like their children to marry one day are more concerned about higher education for their sons than for their daughters.

It is proven that the institution of marriage significantly improves the situation of the partners and their offspring. From this perspective, the different attitudes of social groups towards marriage would contribute in emphasizing the inequalities
Pierre Chaigneau

This being said, is a marriage useful in reality?

For children, studies show that it is essential [5]. Children who are not brought up by their biological parents are twice as more likely not to complete their secondary education, and are five times more likely to be poorer than others. These effects persist when one considers other factors such as ethnic origin, IQ, social background. Furthermore, the situation of children of non-married couples who live together is worse than that of children from married couples.

Reasons contributing to the economic benefit of marriages are numerous : economies of scale for a couple, division of work based on gender, selection (those who marry tend to work hard with their future in mind, etc.), responsibilities of the man, the law of inheritance, less risk associated with dual income [6]. In the United States men and women who marry become on average four times more rich than those who stay single..

Do these benefits however result from marriage itself, or do they simply prove that individuals with the better perspectives are more likely to marry? Robert Lerman [7] answered this question by monitoring a series of individualsʼ characteristics, so that the only essential variable distinguishing them was their material status. He especially considered women who gave birth out of wedlock. He proved that those women who married shortly after giving birth followed a much better path than the others, who were more likely to raise their children in poverty (relative.)

According to the work “Marriage and caste in America”, different attitudes towards marriage are the principle reasons for economic inequality. A series of statistics show that well-educated American women from a higher social class marry more, divorce less, have their own children later in life and are less likely to be single mothers [8]. It would therefore seem that apart from income, cultural and social factors are dominant. Children from average social classes who are raised by their parents have all the advantages for success on their side. In the other extreme, Robert Lerman concludes that the break up of black families in the United States explains the 17 % poverty rate amongst blacks across the Atlantic (which is more than a third the rate of poverty).

CONCLUSION

In conclusion, what must one do to marry well? For men, a good education is essential. For women, those who are educated and who marry will be successful, but their high income could dissuade them from giving up their independence. For everyone, meeting as many single people as possible and daring to to propose to the more desirable will avoid disappointment.

As far as this is concerned, how does one learn to recognise a potential partner? The solution chosen by many couples is to live together before getting married. Paradoxically, couples who follow this path have more chances of divorcing [9]. Why? Simply because one of the two partners could be lead towards a marriage that he or she would not have wished for, in different circumstances. On the contrary, a man and a woman who are assured of their compatibility and of their love for each other, do not necessarily need to live together to put the ring on the finger.

EE , Pierre Chaigneau , July 2011

Article also available in : English EN | français FR

Footnotes

[1] Each woman ranks men in order of preference, and symmetrically for men. Of course, two women can have completely different preferences

[2] College admissions and the stability of marriage, 1962

[3] In the sense that it is impossible to find two couples in which the man prefers the woman of the other couple, and the desired woman also has clear preference for that man rather than her husband. Thus, this man and this woman have interest to separate from their spouses, and to form a new couple, a change which challenges the marital balance.

[4] Genes, Legitimacy and Hypergamy: Another look at the economics of marriage, 2008, http://cep.lse.ac.uk/seminarpapers/...

[5] Source: The Economist, may 26, 2007.

[6] Gary Becker raised the issue in A treatise on the family, 1981

[7] Affiliated to Urban Institute, in Married and unmarried parenthood and economic well-being, and Marriage and the economic well-being of families with children, 2002. http://www.urban.org/UploadedPDF/41...

[8] Source: The Economist, may 26, 2007.

[9] Source: The Economist, may 26, 2007.

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