Household Search and the Marital Wage Premium

Laura Pilossoph and Shu Lin Wee

American Economic Journal: Macroeconomics, 2021, vol. 13, issue 4, 55-109

Abstract: We develop a model where selection into marriage and household search generate a marital wage premium. Beyond selection, married individuals earn higher wages for two reasons. First, income pooling within a joint household raises risk-averse individuals' reservation wages. Second, married individuals climb the job ladder faster, as they internalize that higher wages increase their partner's selectivity over offers. Specialization according to comparative advantage in search generates a premium that increases in spousal education, as in the data. Quantitatively, household search explains 10–33 percent and 20–58 percent of the premium for males and females, respectively, and accounts for its increase with spousal education.

JEL-codes: D83 J12 J16 J24 J31 J64 (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
https://www.aeaweb.org/doi/10.1257/mac.20180092 (application/pdf)
https://doi.org/10.3886/E118064V1 (text/html)
https://www.aeaweb.org/doi/10.1257/mac.20180092.appx (application/pdf)
https://www.aeaweb.org/doi/10.1257/mac.20180092.ds (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aejmac:v:13:y:2021:i:4:p:55-109

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

DOI: 10.1257/mac.20180092

Access Statistics for this article

American Economic Journal: Macroeconomics is currently edited by Simon Gilchrist

More articles in American Economic Journal: Macroeconomics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().