IDEAS home Printed from https://ideas.repec.org/a/spr/empeco/v62y2022i2d10.1007_s00181-021-02021-7.html
   My bibliography  Save this article

The marital earnings premium: an IV approach

Author

Listed:
  • Miguel Olivo-Villabrille

    (UNSW Sydney)

Abstract

Numerous studies find that married men earn more than single men. However, identifying whether and why marriage affects earnings is complicated by the fact that marriage market outcomes are jointly determined with potential earnings. As such, I exploit exogenous variation in marriage induced by the introduction of no-fault divorce laws in the USA to estimate the effect of marriage on the earnings of men. I find a 38% causal increase of marriage on earnings of husbands. This increase in earnings is explained by a large increase in labor market work after marriage. My findings are robust to the possibility of unobserved heterogeneity in the effect of marriage on earnings across individuals.

Suggested Citation

  • Miguel Olivo-Villabrille, 2022. "The marital earnings premium: an IV approach," Empirical Economics, Springer, vol. 62(2), pages 709-747, February.
    • Handle: RePEc:spr:empeco:v:62:y:2022:i:2:d:10.1007_s00181-021-02021-7
    DOI: 10.1007/s00181-021-02021-7
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00181-021-02021-7
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00181-021-02021-7?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Cornwell, Christopher & Rupert, Peter, 1997. "Unobservable Individual Effects, Marriage and the Earnings of Young Men," Economic Inquiry, Western Economic Association International, vol. 35(2), pages 285-294, April.
    2. David S. Loughran & Julie M. Zissimopoulos, 2009. "Why Wait?: The Effect of Marriage and Childbearing on the Wages of Men and Women," Journal of Human Resources, University of Wisconsin Press, vol. 44(2).
    3. Stéphane Mechoulan, 2005. "“Economic Theory’s Stance On No-Fault Divorce”," Review of Economics of the Household, Springer, vol. 3(3), pages 337-359, September.
    4. Avner Ahituv & Robert Lerman, 2007. "How do marital status, work effort, and wage rates interact?," Demography, Springer;Population Association of America (PAA), vol. 44(3), pages 623-647, August.
    5. Schoeni, Robert F, 1995. "Marital Status and Earnings in Developed Countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 8(4), pages 351-359, November.
    6. Betsey Stevenson, 2007. "The Impact of Divorce Laws on Marriage-Specific Capital," Journal of Labor Economics, University of Chicago Press, vol. 25(1), pages 75-94.
    7. Sanders Korenman & David Neumark, 1991. "Does Marriage Really Make Men More Productive?," Journal of Human Resources, University of Wisconsin Press, vol. 26(2), pages 282-307.
    8. Sanderson, Eleanor & Windmeijer, Frank, 2016. "A weak instrument F-test in linear IV models with multiple endogenous variables," Journal of Econometrics, Elsevier, vol. 190(2), pages 212-221.
    9. Goldin, Claudia, 1992. "Understanding the Gender Gap: An Economic History of American Women," OUP Catalogue, Oxford University Press, number 9780195072709, Decembrie.
    10. Donna K. Ginther & Madeline Zavodny, 2001. "Is the male marriage premium due to selection? The effect of shotgun weddings on the return to marriage," Journal of Population Economics, Springer;European Society for Population Economics, vol. 14(2), pages 313-328.
    11. Pierre-Andre CHIAPPORI & Murat IYIGUN & Yoram WEISS, 2015. "The Becker-Coase Theorem Reconsidered," JODE - Journal of Demographic Economics, Cambridge University Press, vol. 81(2), pages 157-177, June.
    12. Eugene Choo, 2015. "Dynamic Marriage Matching: An Empirical Framework," Econometrica, Econometric Society, vol. 83(4), pages 1373-1423, July.
    13. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
    14. repec:cup:jdemec:v:81:y:2015:i:02:p:157-177_00 is not listed on IDEAS
    15. Clément de Chaisemartin, 2017. "Tolerating defiance? Local average treatment effects without monotonicity," Quantitative Economics, Econometric Society, vol. 8(2), pages 367-396, July.
    16. Imran Rasul, 2006. "Marriage Markets and Divorce Laws," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 22(1), pages 30-69, April.
    17. Leora Friedberg, 1998. "Did Unilateral Divorce Raise Divorce Rates? Evidence from Panel Data," NBER Working Papers 6398, National Bureau of Economic Research, Inc.
    18. Eugene Choo & Aloysius Siow, 2006. "Who Marries Whom and Why," Journal of Political Economy, University of Chicago Press, vol. 114(1), pages 175-201, February.
    19. Niko Matouschek & Imran Rasul, 2008. "The Economics of the Marriage Contract: Theories and Evidence," Journal of Law and Economics, University of Chicago Press, vol. 51(1), pages 59-110, February.
    20. Eng Seng Loh, 1996. "Productivity Differences and the Marriage Wage Premium for White Males," Journal of Human Resources, University of Wisconsin Press, vol. 31(3), pages 566-589.
    21. Kate Antonovics & Robert Town, 2004. "Are All the Good Men Married? Uncovering the Sources of the Marital Wage Premium," American Economic Review, American Economic Association, vol. 94(2), pages 317-321, May.
    22. Justin Wolfers, 2006. "Did Unilateral Divorce Laws Raise Divorce Rates? A Reconciliation and New Results," American Economic Review, American Economic Association, vol. 96(5), pages 1802-1820, December.
    23. Pierre-Andre Chiappori & Maurizio Mazzocco, 2017. "Static and Intertemporal Household Decisions," Journal of Economic Literature, American Economic Association, vol. 55(3), pages 985-1045, September.
    24. Alexandra Killewald & Ian Lundberg, 2017. "New Evidence Against a Causal Marriage Wage Premium," Demography, Springer;Population Association of America (PAA), vol. 54(3), pages 1007-1028, June.
    25. Jonathan Gruber, 2004. "Is Making Divorce Easier Bad for Children? The Long-Run Implications of Unilateral Divorce," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 799-834, October.
    26. Niklas Jakobsson & Andreas Kotsadam, 2016. "Does marriage affect men’s labor market outcomes? A European perspective," Review of Economics of the Household, Springer, vol. 14(2), pages 373-389, June.
    27. Chun, Hyunbae & Lee, Injae, 2001. "Why Do Married Men Earn More: Productivity or Marriage Selection?," Economic Inquiry, Western Economic Association International, vol. 39(2), pages 307-319, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Cornaglia, Francesca & Feldman, Naomi E., 2011. "Productivity, Wages, and Marriage: The Case of Major League Baseball," IZA Discussion Papers 5695, Institute of Labor Economics (IZA).
    2. Bruno Jeandidier & Helen Lim, 2015. "Is there justification for alimony payments? A survey of the empirical literature," Working Papers hal-02105214, HAL.
    3. Nabanita Datta Gupta & Nina Smith & Leslie S. Stratton, 2007. "Is Marriage Poisonous? Are Relationships Taxing? An Analysis of the Male Marital Wage Differential in Denmark," Southern Economic Journal, John Wiley & Sons, vol. 74(2), pages 412-433, October.
    4. Ahituv, Avner & Lerman, Robert I., 2005. "How Do Marital Status, Wage Rates, and Work Commitment Interact?," IZA Discussion Papers 1688, Institute of Labor Economics (IZA).
    5. Esfandiar Maasoumi & Daniel L. Millimet & Dipanwita Sarkar, 2009. "Who Benefits from Marriage?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 71(1), pages 1-33, February.
    6. Gustavo J. Bobonis, 2011. "The Impact of Conditional Cash Transfers on Marriage and Divorce," Economic Development and Cultural Change, University of Chicago Press, vol. 59(2), pages 281-312.
    7. Afunts, Geghetsik & Jurajda, Štepán, 2022. "Who Divorces Whom: Unilateral Divorce Legislation and the Educational Structure of Marriage," IZA Discussion Papers 15749, Institute of Labor Economics (IZA).
    8. Fabio Blasutto & Egor Kozlov, 2020. "(Changing) Marriage and Cohabitation Patterns in the US: do Divorce Laws Matter?," 2020 Papers pbl245, Job Market Papers.
    9. Ronald Mincy & Jennifer Hill & Marilyn Sinkewicz, 2009. "Marriage: Cause or mere indicator of future earnings growth?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 28(3), pages 417-439.
    10. Li, Li & Mak, Eric, 2016. "Marriage, Divorce, Remarriage: The Catalyst Effect of Unilateral Divorce," MPRA Paper 83330, University Library of Munich, Germany.
    11. Niklas Jakobsson & Andreas Kotsadam, 2016. "Does marriage affect men’s labor market outcomes? A European perspective," Review of Economics of the Household, Springer, vol. 14(2), pages 373-389, June.
    12. Julio Cáceres-Delpiano & Eugenio Giolito, 2012. "The Impact of Unilateral Divorce on Crime," Journal of Labor Economics, University of Chicago Press, vol. 30(1), pages 215-248.
    13. Francesca Cornaglia & E. Feldman, 2017. "Productivity, Wages, and Marriage: A Case Study in Professional Athletics," Working Papers 818, Queen Mary University of London, School of Economics and Finance.
    14. Chigavazira, Abraham & Fisher, Hayley & Robinson, Tim & Zhu, Anna, 2019. "The Consequences of Extending Equitable Property Division Divorce Laws to Cohabitants," Working Papers 2019-02, University of Sydney, School of Economics.
    15. Ribar, David C., 2004. "What Do Social Scientists Know About the Benefits of Marriage? A Review of Quantitative Methodologies," IZA Discussion Papers 998, Institute of Labor Economics (IZA).
    16. Andrew Shephard, 2019. "Marriage market dynamics, gender, and the age gap," PIER Working Paper Archive 19-003, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    17. Madeline Zavodny, 2008. "Is there a ‘marriage premium’ for gay men?," Review of Economics of the Household, Springer, vol. 6(4), pages 369-389, December.
    18. Avner Ahituv & Robert Lerman, 2007. "How do marital status, work effort, and wage rates interact?," Demography, Springer;Population Association of America (PAA), vol. 44(3), pages 623-647, August.
    19. Astrid Kunze, 2020. "The effect of children on male earnings and inequality," Review of Economics of the Household, Springer, vol. 18(3), pages 683-710, September.
    20. Betsey Stevenson, 2008. "Divorce Law and Women's Labor Supply," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 5(4), pages 853-873, December.

    More about this item

    Keywords

    Marital earnings premium; Marriage; Divorce laws; Local average treatment effects;
    All these keywords.

    JEL classification:

    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • K36 - Law and Economics - - Other Substantive Areas of Law - - - Family and Personal Law

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:empeco:v:62:y:2022:i:2:d:10.1007_s00181-021-02021-7. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.