The Hindu Business Line : Economics of marriage

MY FRIEND is economically motivated to get married! No, he does not intend on taking dowry. On the contrary, he strongly believes that marrying a non-working girl can economically improve his life.

His belief comes from a working paper published by the Institute of Social and Economic Research, UK. So, how is marriage linked to economics?

Based on the British Household Panel Survey, the authors Elena Bardesi and Mark Taylor find the existence of a male marriage premium.

That is, married men get higher wages than their unmarried counterparts. My friend in a desperate attempt to increase his salary, therefore, intends to get married!

Of course, it is logical to question this study. After all, salary hikes are generally (not always) related to productivity.

If married men get higher salaries, does this mean that they are more productive? Or does marriage increase a man's productivity?

The researchers argue that marriage has a positive signalling effect.

How? Married men can be expected to be loyal and dependable.

These are characteristics that an employer looks for in a worker. Since an employer cannot easily determine these factors, marriage could be a signal to conclude that a worker possesses these qualities.

There is, however, more economics to marriage than the signalling effect.

The study finds that the marriage premium is variable. It is generally higher for men whose spouses do not work.

This phenomenon can be explained thus: If the wife also works, the husband has to devote more time to the household. That leaves him lesser time to concentrate on his office.

The result: lesser productivity, lower wage hike. That is why my friend is looking for a non-working girl for a wife!

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