Marriage Meets the Joneses: Relative Income, Identity, and Marital Status

Tara Watson and Sara McLanahan
Additional contact information
Sara McLanahan: Princeton University

No 1141, Working Papers from Princeton University, School of Public and International Affairs, Center for Research on Child Wellbeing.

Abstract: In this paper we investigate the effect of relative income on marital status. We develop an identity model based on Akerlof and Kranton (2000) and apply it to the marriage decision. The empirical evidence is consistent with the idea that people are more likely to marry when their incomes approach a financial level associated with idealized norms of marriage. We hypothesize that the marriage ideal is determined by the median income in an individual?s local reference group. After controlling flexibly for the absolute level of income and a number of other factors, the ratio between a man?s income and the marriage ideal is a strong predictor of marital status but only if he is below the ideal. For white men, relative income considerations jointly drive coresidence, marriage, and fatherhood decisions. For black men, relative income affects the marriage decision only, and relative income is tied to marital status even for those living with a partner and children. Relative income concerns explain 10-15 percent of the decline in marriage since 1970 for low income white men, and account for more than half of the persistent marriage gap between high- and low-income men.

Keywords: marriage; relative income; inequality; identity (search for similar items in EconPapers)
JEL-codes: C01 D10 H31 I38 J12 (search for similar items in EconPapers)
Date: 2009-03
References: View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://www.nber.org/system/files/working_papers/w14773/w14773.pdf

Related works:
Journal Article: Marriage Meets the Joneses: Relative Income, Identity, and Marital Status (2011)
Working Paper: Marriage Meets the Joneses: Relative Income, Identity, and Marital Status (2009)
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:pri:crcwel:wp09-04-ff.pdf

Access Statistics for this paper

More papers in Working Papers from Princeton University, School of Public and International Affairs, Center for Research on Child Wellbeing. Contact information at EDIRC.
Bibliographic data for series maintained by Bobray Bordelon ().