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March 25, 2013

Excellent Post on the Marriage Premium

A rebuttal to the theory that there's no causal relationship between marriage and the higher wages for married men. I've excerpted just a few items but you should read the whole thing:

- No credible evidence? How about the mere fact that the marriage premium (for men) and marriage penalty (for women) persists after controlling for age, education, race, and a long list of other confounding variables?

- Following Heckman's lead, education economists increasingly emphasize the importance of non-cognitive skills (conscientiousness, ambition, organization, etc.). Isn't it plausible that marriage would causally raise men's non-cognitive skill via expectations, praise, nagging, devotion, etc.?

- It's easy to see the appeal of the selection story: Married people have many traits in common: willingness to commit, to defer gratification, to conform to social norms. Why then, though, do married men earn a large premium, while married women earn a modest penalty? Shouldn't favorable selection enhance women's earnings, too?


- If you say, "Women de-emphasize their careers after they marry," you're appealing to a treatment effect. And if you can believe that women de-emphasize their careers as a result of marriage, why can't you believe that men emphasize their careers as a result of marriage?

- Kids substantially reduce female earnings. Few doubt that this effect is causal: Kids don't just take time; they change priorities. If you can believe that kids change their moms' labor market behavior, why can't you believe that spouses change each others' labor market behavior?

Food for thought.

Posted by Cassandra at March 25, 2013 08:41 AM

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Comments

You mean that I work harder to make more money because I have mouths to feed at home? This is truly shocking behavior! I'm astonished that no one has ever noticed this before. :-)

Posted by: spd rdr at March 25, 2013 11:51 AM

"You mean that I work harder to make more money because I have mouths to feed at home?"

Well, in all fairness, spd, your *mouths* are female, and I'm thinkin' you long ago figured out that they don't talk as much, whine/nag as much or ask for the Visa Platinum card when their mouths are full.
0>;~}

Posted by: DL Sly at March 25, 2013 01:04 PM

Statistics *never* show causality.

Cooling water below 32 degrees F causes water to freeze. It does not make it statistically more likely to freeze. Dropping a ball held up in the air causes it to fall. It does not make it statistically more likely to fall.

To show causality you need more than statistics.

/pedant

Posted by: Yu-Ain Gonnano whose statistically more likely to be pedantic at March 25, 2013 03:41 PM

Who's, not whose.

Posted by: Yu-Ain Gonnano who's statistically more likely to make a typo while being pedantic at March 25, 2013 03:42 PM

That said, I think it reasonable that there is something more than a self-selection bias occuring.

The safety net of two people working together for a common good allows people to do things that individually would be foolish. Such as take the risk to quit work and raise kids, or take the risk of being over-promoted.

"Though one may be overpowered, two can defend themselves. A cord of three strands is not quickly broken." - Ecclesiastes 4:12

Posted by: Yu-Ain Gonnano who's statistically more likely to make a typo while being pedantic at March 25, 2013 03:58 PM

I have only one question...
Married with children, do you count who makes what or do you just sum it all up?

And, what is in the summation? I suspect even Hilbert couldn't account for all of that.

My motto: tummy full children; sleeping warmly; makes for a very less disgruntled Allen. :)

That's one of those things you don't care about how you got there, you're just fine being there.

Posted by: Allen at March 26, 2013 05:19 AM

Oh, and if marriage "causes" a premium for men and a penalty for women, what then will happen in same sex marriages?

Party at the gay male couple's house!

Posted by: Yu-Ain Gonnano at March 26, 2013 08:59 AM