Marriage meets the Joneses

Tara Watson 05 May 2009

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Low-income American men are less likely to be married than their higher-income counterparts. Among 25-to-34-year-old white men in the 2000 US Census, for example, 34% of those in the bottom quarter of the income distribution are married, compared with 67% of those in the top quarter of the income distribution. For black men, the numbers are 16% and 50%, respectively.

Why are low-income men so much less likely to be married? A standard search model would suggest that, if low-income men are less attractive partners ceteris paribus, women would turn down a low-income man in the hopes of finding someone with a little more bling. The sociologists William Julius Wilson (1987) and Kathy Edin (2000) suggest that men without stable employment are viewed as un-marriageable. An alternative explanation is that when women exceed men in the marriage pool (as in many inner city neighbourhoods), women lack bargaining power and men fathering children with multiple women can become the norm (Willis, 1999).

These are some compelling explanations for why low-income men don’t end up in stable partnerships. But they do little to explain the non-marriage of respondents in a qualitative survey of low-income parents by Gibson-Davis, Edin, and McLanahan (2005). In the survey, all of the couples have a child together, most live together, and most say they plan to marry. Three quarters of the couples cite their financial situation as a barrier to marriage. From the viewpoint of mainstream economic theory, which focuses on specialisation within the household (Becker, 1981) and the public good aspects of raising children (Lam, 1988), most of the economic costs and benefits of marriage are already realised by couples who live and have children together. The notion that cohabiting low-income parents “can’t afford” to get married is puzzling.

Pressed further, the couples in the Gibson-Davis study reveal that they viewed a certain standard of living as necessary for marriage. What constitutes the “marriage ideal” differs across individuals, but respondents frequently invoke markers of a middle class lifestyle - a house with a garage or a big wedding - as a prerequisite to tying the knot. Couples are willing to put off marriage until their financial aspirations were met, even though for some the goals were unlikely to be attainable in the foreseeable future.

Motivated by the Gibson-Davis evidence, my recent work with Sara McLanahan (Watson and McLanahan, 2009) investigates whether the marital status of young men responds to financial expectations. We build on the ideas of Easterlin (1980) who posits that young adults postpone marriage until their financial aspirations are realised. Our hypothesis is that the financial expectations for a given couple are determined by the income level of a salient local reference group – for example, those in the same education or race group and the same metropolitan area. Specifically, we define the “ideal” income for marriage to be the median income of full-time, full-year workers in the reference group. Then, we compare low-income men that have the same real income but face different marriage ideals. Our sample includes more than 1.3 million 25-to-34-year old men in the 1980, 1990, and 2000 US Censuses.

The evidence suggests that relative income matters. Conditional on absolute income, low-income men are less likely to be married if they live in a high-income metropolitan area. Ideals defined by race or education groups within metropolitan areas are particularly salient. Even after carefully controlling for the purchasing power of a man and many other factors, the ratio of his income to the “ideal” is a strong predictor of marriage – but only for men below the ideal. For sufficiently high-income men, relative income doesn’t affect marital status.

We also look at the decision to reside with and have children with a partner. For low-income white men, it appears that approaching the marriage ideal makes them more likely to move in with their partner, get married, and start a family. For black men, unmarried cohabitation with children is much more common, and relative income only affects the marriage decision. The decision to live with a partner and children is not related to relative income concerns. Indeed, relative income is associated with the marital status of low-income black men who have already decided to live with a partner and children. These men and their partners appear to be opting to defer marriage if their income lies below a certain level, and that level is influenced by the incomes of others in their reference group.

What do we make of all this? We suspect that low-income couples aspire to achieve a certain economic status before deciding to marry, and that the level of income they need is determined in part by those around them. We propose an identity model (similar to that of Akerlof and Kranton, 2000) to explain the phenomenon. Couples prefer to identify as a member of the category “married people” only if they fulfil the financial prescriptions associated with marriage. One couple interviewed in the Gibson-Davis study kept their marriage a secret because they still lived with relatives. As the husband put it: “How do I tell everybody that I’m married, but I’m broke? Or I’m married but I don’t have no place?”

In an era of rising inequality, men at the bottom of the income distribution are increasingly far from the middle class lifestyle that some view as a prerequisite to marriage. Rising inequality explains less than 15% of the decline in marriage since 1970 – the changes in relative income are dwarfed by other social forces. Nevertheless, the analysis indicates that half of the marriage gap between high- and low-income men is determined by relative – rather than absolute – income. Low-income couples, even some who live together and have children, defer marriage until they can catch up with the Joneses.

References

Akerlof, George A. and Rachel E. Kranton, 2000. “Economics and Identity,” Quarterly Journal of Economics, 115(3), 715-753.
Becker, Gary S., 1981. A Treatise on the Family. Harvard University Press, Cambridge.
Easterlin, Richard A., 1980. Birth and Fortune: The Impact of Numbers on Personal Welfare, Basic Books, New York.
Edin, Kathryn, 2000. “What Do Low-Income Single Mothers Say about Marriage?,” Social Problems, 47(1), 112-133.
Gibson-Davis, Christina M., Kathryn Edin, and Sara McLanahan, 2005. “High Hopes But Even Higher Expectations: The Retreat From Marriage Among Low-Income Couples,” Journal of Marriage and Family, 67(5), 1301-1312.
Lam, David, 1988, “Marriage Markets and Assortative Mating with Household Public Goods: Theoretical Results and Empirical Implications,” The Journal of Human Resources, 23(4), 462-487.
Watson, Tara, and Sara McLanahan, 2009. “Marriage Meets the Joneses: Relative Income, Identity, and Marital Status,” National Bureau of Economic Research Working Paper 14773.
Willis, Robert J., 1999. “A Theory of Out-of-Wedlock Childbearing,” Journal of Political Economy, 107(6), S33-S64.
Wilson, William Julius, 1987. The Truly Disadvantaged: The City, the Underclass, and Public Policy, University of Chicago Press, Chicago.

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Topics:  Frontiers of economic research

Tags:  marriage, economic status.

Assistant Professor of Economics at Williams College in Williamstown, Massachusetts

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