An economist from Konstanz shows that choice of marriage partner affects income inequality
Changes in society in choosing a marriage partner contribute to income inequality across households. Professor Dr. Georgi Kocharkov, Junior Professor of Macroeconomics at the University of Konstanz, has established this fact together with researchers from the Universities of Pennsylvania (USA), Barcelona (Spain) and Mannheim (Germany) in the study "Marry your like: Assortative Mating and Income Inequality" released by The National Bureau of Economic Research (U.S.A.). The researchers analysed the interaction of marriage partner choices and the distribution of income across households. Positive assortative mating, or in other words, the tendency of choosing a partner with the same level of education or income, has increased so significantly over the past five decades in the U.S., that it has a considerable effect on the income distribution. The results of the study will be published in the annual issue of "The American Economic Review Papers and Proceedings".
Analysing hundreds of thousands of households from the U.S. Census, the researchers show that both the degree of assortative mating based on the education of husbands and wives, and the Gini coefficient, which measures income inequality in a society, rose significantly from 1960 to 2005. Marrying a partner from another social class, which happened more often back in the 1960s, leads to a redistribution of income among households. Today, there are more married households with partners at the same income level, which leads to an increase in inequality.
"The results of our analysis show that if marital matching in the U.S. in 2005 was completely random instead of positively assortative as in the data, household income inequality would be dramatically lower", explains Georgi Kocharkov. One of the reasons for this development is the increased proportion of women in the labour market. "As women are better educated today, more women work, and less women have little or no income, resulting in more equality. However, with women working, married households have two earners instead of one. Thus the increased positive assortative mating pattern of marriages in the 2000s leads to a wider gap between households with two high-wage earners and households with two low-wage earners", says the economist.
Georgi Kocharkov has been a Junior Professor of Macroeconomics, Family Economics and Labour Economics at the University of Konstanz since 2012. After studying economics at the Central European University in Budapest (Hungary) he obtained his doctoral degree from Universidad Carlos III de Madrid (Spain). He is a member of the Graduate School of Decision Sciences at the University of Konstanz, which has been funded by the German Excellence Initiative since 2012.
Marry Your Like: Assortative Mating and Income Inequality, with Jeremy Greenwood, Nezih Guner and Cezar Santos, American Economic Review Papers and Proceedings, 2014