IDEAS home Printed from https://ideas.repec.org/p/gro/rugsom/00d56.html
   My bibliography  Save this paper

Risk, cohabitation and marriage

Author

Listed:
  • Rao Sahib, P.
  • Gu, X.

    (Groningen University)

Abstract

This paper introduces imperfect information,learning,and risk aversion in a two sided matching model.The modelprovides a theoreticalframework for the com- monly occurring phenomenon of cohabitation followed by marriage,and is con- sistent with empirical findings on these institutions.The paper has three major results.First,individuals set higher standards for marriage than for cohabitation. When the true worth of a cohabiting partner is revealed,some cohabiting unions are converted into marriage while others are not.Second,individuals cohabit within classes.Third,the premium that compensates individuals for the higher risk involved in marriage over a cohabiting partnership is derived.This premium can be decomposed into two parts.The first part is a function of the individual ’s level of risk aversion,while the second part is a function of the di difference in risk between marriage and cohabitation.

Suggested Citation

  • Rao Sahib, P. & Gu, X., 2000. "Risk, cohabitation and marriage," Research Report 00D56, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    • Handle: RePEc:gro:rugsom:00d56
    as

    Download full text from publisher

    File URL: http://irs.ub.rug.nl/ppn/24099907X
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bloch, Francis & Ryder, Harl, 2000. "Two-Sided Search, Marriages, and Matchmakers," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(1), pages 93-115, February.
    2. Waters, Melissa S. & Ressler, Rand W., 1999. "An economic model of cohabitation and divorce," Journal of Economic Behavior & Organization, Elsevier, vol. 40(2), pages 195-206, October.
    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. Padma Rao Sahib & Xinhua Gu, 2002. "To Tie the Knot or Not," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 6(13), pages 355-382.
    2. repec:dgr:rugsom:00d56 is not listed on IDEAS
    3. Herrenbrueck, Lucas & Xia, Xiaoyu & Eastwick, Paul & Hui, Chin Ming, 2018. "Smart-dating in speed-dating: How a simple Search model can explain matching decisions," European Economic Review, Elsevier, vol. 106(C), pages 54-76.
    4. Steven F. Koch, 2005. "Love and Addiction: The Importance of Commitment," Working Papers 200516, University of Pretoria, Department of Economics.
    5. Gal-Or, Esther, 2020. "Market segmentation on dating platforms," International Journal of Industrial Organization, Elsevier, vol. 68(C).
    6. Ran Abramitzky & Adeline Delavande & Luis Vasconcelos, 2011. "Marrying Up: The Role of Sex Ratio in Assortative Matching," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 124-157, July.
    7. Xu, Yujing & Yang, Huanxing, 2019. "Targeted search with horizontal differentiation in the marriage market," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 31-62.
    8. Ata Atay & Eric Bahel & Tamás Solymosi, 2023. "Matching markets with middlemen under transferable utility," Annals of Operations Research, Springer, vol. 322(2), pages 539-563, March.
    9. De Fraja, Gianni & Sákovics, József, 2012. "Exclusive nightclubs and lonely hearts columns: Non-monotone participation in optional intermediation," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 618-632.
    10. Hofmann, Dirk & Qari, Salmai, 2011. "The law of attraction bilateral search and horizontal heterogeneity," SFB 649 Discussion Papers 2011-017, Humboldt University Berlin, Collaborative Research Center 649: Economic Risk.
    11. E. M. Parilina & A. Tampieri, 2013. "Marriage Formation with Assortative Meeting as a Two-Sided Optimal Stopping Problem," Working Papers wp886, Dipartimento Scienze Economiche, Universita' di Bologna.
    12. Adachi, Hiroyuki, 2003. "A search model of two-sided matching under nontransferable utility," Journal of Economic Theory, Elsevier, vol. 113(2), pages 182-198, December.
    13. Akiko Maruyama, 2018. "One-sided learning about one fs own type in a two-sided search model: The case of n types of agents," GRIPS Discussion Papers 18-15, National Graduate Institute for Policy Studies.
    14. Kai Konrad, 2015. "Affection, speed dating and heartbreaking," Journal of Population Economics, Springer;European Society for Population Economics, vol. 28(1), pages 159-172, January.
    15. Linda Y. Wong, 2003. "Structural Estimation of Marriage Models," Journal of Labor Economics, University of Chicago Press, vol. 21(3), pages 699-728, July.
    16. Yang Liu & Zhi-Ping Fan & Yan-Ping Jiang, 2018. "Satisfied surgeon–patient matching: a model-based method," Quality & Quantity: International Journal of Methodology, Springer, vol. 52(6), pages 2871-2891, November.
    17. Hector Chade & Gustavo Ventura, 2002. "Taxes and Marriage: A Two-Sided Search Analysis," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(3), pages 955-986, August.
    18. Frederick Chen, 2003. "Unraveling in a dynamic matching market with Nash bargaining," Economics Bulletin, AccessEcon, vol. 3(17), pages 1-6.
    19. Coles, M & Francesconi, M, 2013. "Equilibrium Search and the Impact of Equal Opportunities for Women," Economics Discussion Papers 9010, University of Essex, Department of Economics.
    20. Amitrajeet Batabyal, 2004. "On strategy and the likelihood of success in marital matchmaking under uncertainty," Economics Bulletin, AccessEcon, vol. 10(7), pages 1-7.
    21. Loertscher, Simon & Niedermayer, Andras, 2020. "Entry-deterring agency," Games and Economic Behavior, Elsevier, vol. 119(C), pages 172-188.

    More about this item

    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:gro:rugsom:00d56. 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: Hanneke Tamling (email available below). General contact details of provider: https://edirc.repec.org/data/ferugnl.html .

    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.