Economics of Love and Marraige Flashcards
(15 cards)
Full Income
The sum of monetary income and income forgone by the use of time and goods to obtain utility. The oppurtunity cost of a spouse working from home is the occupation and income given up.
Gary becker hypothesises that households specialise, for outside the home production and inside the home production. Opposites attract.
Oppurtunity Costs
The oppurtunity cost of a spouse working from home is the occupation and income given up.
Specialisation of Labor
Gary becker hypothesises that households specialise, for outside the home production and inside the home production. Opposites attract.
Consumption Synergies
When domestic production skills were high and market production
required physical labour, couples would complement each other
more efficiently if one had domestic skills and the other market
skills.
When domestic skills are much lower and market skills are less
physical, the benefits of these specialised production skills are
less important
Similars attract
Risk Pooling
Two incomes reduces ther isk of shocks to income.
Thin Markets
Markets with less availability of potential partners, for example with homosexual and lqbtqia+ individules. They are more likely to use online dating sites.
Differentiated goods
Goods that are wholly unique, like partners. Not all are the same, so people have to search to find the one that fits best. The one you choose to be with becomes the right one with “firm specific specalisation”.
Search Costs
Reduced with dating apps. Includes the time going on dates.
Signalling
One party credibly conveys some information about themselves to another party.
- Credibility often comes from the signal being costly for the sender
Changes to The Benefits and Costs of Marraige and Divorse
Benefits of marraige
- Birth control and abortion decrease cost of being single and the relative benefit of marraige.
- Also allows for higher human capital accumaton with less disruptiont to work, decreased benefit of marraige with specialisation.
- Consumption complimentaries, increase benefits of marraige for same sex couples.
- Societal norms of cohabitation, less demand for tradition, taxes, and legal protections increase cohabitation and decrease relative benefit of maraige
Costs of marraige
- No fault divorce, equal division of assets and child support lower the potential threats of marraige such as domestic violence.
- Social acceptability of divorce decreases
Costs of divorce
- No fault divorce, euqal divison of labor, child support
- Societal support with changes to norms
Benefits to divroce
- Dating apps, remarraige, acceptability
Lazear. (2015). Gary Becker’s Impact on Economics and Policy. The American Economic Review, 105(5), 80–84.
Theory of the household; oppostives and specialisation. Families are utility maximisers. Household like a factory.
Stevenson & Wolfers. (2007). Marriage and Divorce: Changes and their Driving Forces. Journal of Economic Perspectives, 21(2): 27–52.
The new model of marraige. Increse trend in dicorce, decrease but relatively stable trend in marraige. more remmarying. Due to changes in technology of birth cntrol, household tech, wage structure,s legal structure of marraige, shocks to marraige market.
Freakonomics Radio Podcast (February 14, 2013): Why Marry?
PBS News Hour (February 12, 2016): In the Market for Love? Here’s How Economics Can Help
Addictive qualities.
What are people looking for,the relative cost of the sit.e People need to settle.
The Economic Case for Same-Sex Marriage
Comsumption Complimentares, more in common.
