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Is Marriage Poisonous? Are Relationships Taxing? An Analysis of the Male Marital Wage Differential in Denmark

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Author Info
Nabanita Datta Gupta (Danish National Institute of Social Research, CIM and IZA Bonn)
Nina Smith () (Aarhus School of Business, CIM and IZA Bonn)
Leslie S. Stratton (Virginia Commonwealth University, CIM and IZA Bonn)

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Abstract

The word for ‘married’ in Danish is the same as the word for ‘poison’. The word for 'sweetheart' in Danish is the same as the word for 'tax'. In this paper we expand upon the literature documenting a significant marital wage premium for men in the United States to see if a similar differential exists for married men in Denmark - or if the homonyms have perhaps less of a double meaning. Unlike most other research in this area, our study is based on a large panel sample with complete relationship histories, consisting of about 35,000 young Danish men observed before and after their first marriage or cohabitation during the years 1984-2001. Since the majority of young Danes cohabit before they marry, if they ever marry, cohabitation is allowed for as a separate state. Pooled OLS estimates indicate a marital wage premium of 4-5%, which drops to 2% after controlling for selectivity. The cohabitation premium is found to be of the same size as the marital wage premium. Our results indicate that a part of the marriage or cohabitation premium is not due to marriage or cohabitation itself, but to fatherhood. When information on becoming a father and years spent in fatherhood is added to the empirical model, the results show that fathers receive a ‘fatherhood’ premium during their first few years as fathers and that the initial marital wage premium is reduced.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1591.

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Length: 29 pages
Date of creation: May 2005
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Handle: RePEc:iza:izadps:dp1591

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Related research
Keywords: marriage premium cohabitation fatherhood

Other versions of this item:

Find related papers by JEL classification:
J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Cornwell, Christopher & Rupert, Peter, 1997. "Unobservable Individual Effects, Marriage and the Earnings of Young Men," Economic Inquiry, Oxford University Press, vol. 35(2), pages 285-94, April.
  2. Joni Hersch & Leslie S. Stratton, 2000. "Household specialization and the male marriage wage premium," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 54(1), pages 78-94, October.
  3. Jacobsen, Joyce P & Rayack, Wendy L, 1996. "Do Men Whose Wives Work Really Earn Less?," American Economic Review, American Economic Association, vol. 86(2), pages 268-73, May. [Downloadable!] (restricted)
  4. 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.).
  5. Schoeni, Robert F, 1995. "Marital Status and Earnings in Developed Countries," Journal of Population Economics, Springer, vol. 8(4), pages 351-59, November.
    Other versions:
  6. Ribar, David C., 2004. "What Do Social Scientists Know About the Benefits of Marriage? A Review of Quantitative Methodologies," IZA Discussion Papers 998, Institute for the Study of Labor (IZA). [Downloadable!]
  7. Naur, M. & Smith, N., 1996. "Cohort Effects on the Gender Wage Gape in Danmark," Papers 96-05, Centre for Labour Market and Social Research, Danmark-.
  8. Florence Jaumotte, 2003. "Female Labour Force Participation: Past Trends and Main Determinants in OECD Countries," OECD Economics Department Working Papers 376, OECD Economics Department. [Downloadable!]
  9. Datta Gupta, Nabanita & Smith, Nina, 2002. "Children and Career Interruptions: The Family Gap in Denmark," Economica, London School of Economics and Political Science, vol. 69(276), pages 609-29, November. [Downloadable!] (restricted)
    Other versions:
  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, vol. 14(2), pages 313-328. [Downloadable!] (restricted)
    Other versions:
  11. Schettkat, Ronald, 2003. "Differences in US-German Time-Allocation: Why Do Americans Work Longer Hours than Germans?," IZA Discussion Papers 697, Institute for the Study of Labor (IZA). [Downloadable!]
  12. Daniel, K., 1991. "Does Marriage Make Men More Productive?," University of Chicago - Economics Research Center 92-2, Chicago - Economics Research Center.
  13. Chun, Hyunbae & Lee, Injae, 2001. "Why Do Married Men Earn More: Productivity or Marriage Selection?," Economic Inquiry, Oxford University Press, vol. 39(2), pages 307-19, April.
  14. Gunnar Isacsson, 2004. "Estimating the economic return to educational levels using data on twins," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 19(1), pages 99-119. [Downloadable!]
  15. Callan, T. & Dex, S. & Smith, N. & Vlasblom, J.D., 1999. "Taxation of Spouses: a Cross-Country Study of the Effects on Maaried Women's Labour Supply," Papers 99-02, Centre for Labour Market and Social Research, Danmark-.
  16. Leslie S. Stratton, 2002. "Examining the Wage Differential for Married and Cohabiting Men," Economic Inquiry, Oxford University Press, vol. 40(2), pages 199-212, April.
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Cited by:
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  1. William M. Rodgers III & Leslie S. Stratton, 2005. "The Male Marital Wage Differential: Race, Training, and Fixed Effects," IZA Discussion Papers 1745, Institute for the Study of Labor (IZA). [Downloadable!]
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