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Why Does Spousal Education Matter for Earnings? Assortative Mating or Cross-productivity

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Author Info
Chong Huang
Hongbin Li
Pak Wai Liu
Junsen Zhang

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Abstract

In interpreting the positive relationship between spousal education and one's earnings, economists have two major hypotheses: cross-productivity between couples and assortative mating. However, no prior empirical study has been able to separate the two effects. This paper empirically disentangles the two effects by using twins data that we collected from urban China. We have two major innovations: we use twins data to control for the unobserved mating effect in our estimations, and we estimate both current and wedding-time earnings equations. Arguably, the cross-productivity effect takes time to be realized and thus is relatively unimportant at the time of the wedding. Any effect of spousal education on wedding-time earnings should more likely be the mating effect. We find that both cross-productivity and mating are important in explaining the current earnings. Although the mating effect exists for both husbands and wives, the cross-productivity effect only runs from Chinese husbands to wives. We further show that the cross-productivity effect is realized by increasing the hourly wage rate rather than working hours.

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Paper provided by Chinese University of Hong Kong, Department of Economics in its series Discussion Papers with number 00020.

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Date of creation: Jan 2006
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Handle: RePEc:chk:cuhkdc:00020

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General

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  1. Alan Krueger & Orley Ashenfelter, 1992. "Estimates of the Economic Return to Schooling from a New Sample of Twins," NBER Working Papers 4143, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  2. Welch, Finis, 1974. "Benefits of Women's Education within Marriage: Comment," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages S72-S75, Part II, . [Downloadable!] (restricted)
  3. Tiefenthaler, Jill, 1997. "The Productivity Gains of Marriage: Effects of Spousal Education on Own Productivity across Market Sectors in Brazil," Economic Development and Cultural Change, University of Chicago Press, vol. 45(3), pages 633-50, April.
  4. Orley Ashenfelter & Cecilia Rouse, 1998. "Income, Schooling, And Ability: Evidence From A New Sample Of Identical Twins," The Quarterly Journal of Economics, MIT Press, vol. 113(1), pages 253-284, February. [Downloadable!] (restricted)
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  5. Boulier, Bryan L & Rosenzweig, Mark R, 1984. "Schooling, Search, and Spouse Selection: Testing Economic Theories of Marriage and Household Behavior," Journal of Political Economy, University of Chicago Press, vol. 92(4), pages 712-32, August. [Downloadable!] (restricted)
  6. Liu, Pak-Wai & Zhang, Junsen, 1999. "Assortative Mating versus the Cross-Productivity Effect," Applied Economics Letters, Taylor and Francis Journals, vol. 6(8), pages 523-25, August. [Downloadable!] (restricted)
  7. David Neumark & Sanders D. Korenman, 1988. "Does marriage really make men more productive?," Finance and Economics Discussion Series 29, Board of Governors of the Federal Reserve System (U.S.).
  8. Benham, Lee, 1974. "Benefits of Women's Education within Marriage," Journal of Political Economy, University of Chicago Press, vol. 82(2), pages S57-S71, Part II, . [Downloadable!] (restricted)
  9. Becker, Gary S, 1973. "A Theory of Marriage: Part I," Journal of Political Economy, University of Chicago Press, vol. 81(4), pages 813-46, July-Aug.. [Downloadable!] (restricted)
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  10. Erik Plug, 2004. "Estimating the Effect of Mother's Schooling on Children's Schooling Using a Sample of Adoptees," American Economic Review, American Economic Association, vol. 94(1), pages 358-368, March. [Downloadable!] (restricted)
  11. Schoeni, Robert F, 1995. "Marital Status and Earnings in Developed Countries," Journal of Population Economics, Springer, vol. 8(4), pages 351-59, November.
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  12. Behrman, Jere R. & Rosenzweig, Mark R., 1999. ""Ability" biases in schooling returns and twins: a test and new estimates," Economics of Education Review, Elsevier, vol. 18(2), pages 159-167, April. [Downloadable!] (restricted)
  13. Kenny, Lawrence W, 1983. "The Accumulation of Human Capital during Marriage by Males," Economic Inquiry, Oxford University Press, vol. 21(2), pages 223-31, April.
  14. Bound, John & Solon, Gary, 1999. "Double trouble: on the value of twins-based estimation of the return to schooling," Economics of Education Review, Elsevier, vol. 18(2), pages 169-182, April. [Downloadable!] (restricted)
  15. Scully, Gerald W, 1979. "Mullahs, Muslims, and Marital Sorting," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 1139-43, October. [Downloadable!] (restricted)
  16. Neuman, Shoshana & Ziderman, Adrian, 1992. "Benefits of Women's Education within Marriage: Results for Israel in a Dual Labor Market Context," Economic Development and Cultural Change, University of Chicago Press, vol. 40(2), pages 413-24, January.
  17. Wong, Yue-chim, 1986. "Entrepreneurship, Marriage, and Earnings," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 693-99, November. [Downloadable!] (restricted)
  18. Jere R. Behrman & Mark R. Rosenzweig, 2002. "Does Increasing Women's Schooling Raise the Schooling of the Next Generation?," American Economic Review, American Economic Association, vol. 92(1), pages 323-334, March. [Downloadable!] (restricted)
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