Marriage Market Counterfactuals Using Matching Models

We use a simple structural matching model with unobserved heterogeneity to produce counterfactual marriage patterns, and thus quantify the contribution of changes in marital patterns in rising income inequality. We propose an algorithm that allows us to fix the degree of assortative mating without c...

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Bibliographic Details
Published in:Economica (London) 2022-01, Vol.89 (353), p.29-43
Main Authors: Dupuy, Arnaud, Weber, Simon
Format: Article
Language:English
Subjects:
Algorithms
Assortative mating
Changes
Counterfactual thinking
Heterogeneity
Income inequality
Marriage
Marriage patterns
Mating
Nuptiality
Women
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Summary:We use a simple structural matching model with unobserved heterogeneity to produce counterfactual marriage patterns, and thus quantify the contribution of changes in marital patterns in rising income inequality. We propose an algorithm that allows us to fix the degree of assortative mating without changing the level of marital gains and hence isolate the intensive and extensive margins (i.e. isolate changes in assortative mating from changes in marriage rates). We apply this approach to US data from 1962 to 2017, and show that marital patterns can explain about a quarter of the rise in income inequality, the intensive margin contributing 7%, the extensive margin the remaining 93%. Our algorithm also allows us to show that the extensive margin is itself driven for three‐fifths by a change in the total number of singles and for two‐fifths by a change in the distribution of types among singles (in particular low‐educated women).
ISSN:0013-0427
1468-0335
DOI:10.1111/ecca.12386