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Education in a Marriage Market Model without Commitment

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  • Raphaela Hyee

    (Queen Mary, University of London)

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    Abstract

    This paper develops a model that combines intra-household bargaining with competition on the marriage market to analyse women's and men's incentives to invest in education. Once married, spouses bargain over their share of total household income. They have the option of unilateral divorce and subsequent remarriage. Through this channel, the marriage market situation (the quality of prospective spouses and the distribution of resources in other couples) influences the distribution within existing couples. Individuals differ in their educational attainment, and more educated individuals contribute more to household income. I use this model to study the impact of changes in the rates of educational attainment of men and women on intra-household distribution. An increase in the number of women who obtain a university degree over an above the number of men who do so benefits men without degrees; university educated men, however, are not able to translate this change on the marriage market into a significantly larger share of household income. Hence, men's incentive to invest in education decreases if more women become educated. Even without assuming any heterogeneity in tastes between men and women, equilibria arise in which men and women decide to become educated at different rates.

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    Bibliographic Info

    Paper provided by Queen Mary, University of London, School of Economics and Finance in its series Working Papers with number 683.

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    Date of creation: Oct 2011
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    Handle: RePEc:qmw:qmwecw:wp683

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    Keywords: Family bargaining; Gender education gap; Investment in education;

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    1. René Böheim & Helmut Hofer & Christine Zulehner, 2007. "Wage differences between Austrian men and women: semper idem?," Empirica, Springer, vol. 34(3), pages 213-229, July.
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    15. Michael Peters & Aloysius Siow, 2000. "Competing Pre-marital Investments," Working Papers peters-00-01, University of Toronto, Department of Economics.
    16. Binmore, Ken & Shaked, Avner & Sutton, John, 1989. "An Outside Option Experiment," The Quarterly Journal of Economics, MIT Press, vol. 104(4), pages 753-70, November.
    17. Shelly Lundberg & Robert A. Pollak, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-158, Fall.
    18. Eric D. Gould, 2008. "Marriage and Career: The Dynamic Decisions of Young Men," Journal of Human Capital, University of Chicago Press, vol. 2(4), pages 337-378.
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    Cited by:
    1. Raphaela Hyee, 2011. "Do Marriage Markets Influence the Divorce Hazard?," Working Papers 685, Queen Mary, University of London, School of Economics and Finance.

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