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Economics and the Millennial Marriage Drought

Economics and the Millennial Marriage Drought published on No Comments on Economics and the Millennial Marriage Drought

“Why aren’t Millennials getting married? Despite the popularity of dating apps like Tinder, Grindr, and OKCupid, Millennials are not pairing off.”

That’s the opening line of an interesting post by Olivia Gonzalez and Erikagrace Davies over at LearnLiberty.org. It’s an important question. And an important observation.

They go on to suggest that a significant reason for the drop in marriage rates among millennials is due to lower real incomes relative to prior generations, combined with the need to be more mobile in today’s society and the difficulty that creates for young, dual-income couples. They suggest that the gig economy may create more non-traditional income opportunities that make it easier for such couples to work and, thereby, afford to get married.

I’d propose an alternate hypothesis–though one still rooted in economics–and it’s based on the opening lines themselves. The popularity of dating apps like Tinder, Grindr and OKCupid do more than just increase the ease of finding one’s true love. They highlight the great diversity of potential mates–not even just locally, but around the globe. What’s more, such apps and other social media make it easier to access–and assess–that much more diverse population of potential mates.

So what’s economic about that? Option theory.

An option is the right, but not the obligation, to take some action. Think of the decision to marry as an option. Dating allows someone to do more than just sow their wild oats. It allows them to consider different potential mates to find the “best one” for them, however one might define “best”.  But when one exercises the option to marry, the option to continue looking for a better mate is killed (at least in a society still dominated by norms of monogamy). In other words, there is an opportunity cost to getting married in the form of the foregone opportunity to find someone even better.

That means the opportunity cost of getting married is higher when there is a greater diversity of potential mates in the world. To use the language of option theory, the value of the “option” to marry is higher when there is a greater variance in the value (or quality) of potential mates. But once one executes the option and gets married, that value is lost.

This is really nothing new. According to the US Census Bureau, the rate of marriage among young adults has been declining for decades (as shown in the nearby graph from FiveThirtyEight)–well before social media and well before the economic constraints Gonzalez and Davies describe, but in line with the increased education and labor force participation of women. This provided women more economic independence, which allowed women to retain the option to marry longer–not needing to “cash it in” at a discount in return for economic security. Similarly, men encountered a more heterogeneous population of potential mates with a higher variance in potential quality. Throw in changing norms on same-sex partners and marriage over the past few decades, and the pool of potential partners is even more diverse.

Social media has not only amplified that fact, but has made it easier to consider and explore the greater variety of potential partners–making it that much easier to draw a sample from the population distribution. That means one can keep looking at relatively low cost, which increases the probability of drawing someone from the “best” end of the distribution. That makes the option all the more valuable–and the opportunity cost of executing the option that much higher.

Marriage is a complex issue, as reflected in this Pew Research Center report. (Staying married is even more complex.) I’m not suggesting an option framework fully captures the motivation and explanation for the “millennial marriage drought”, but understanding that perspective sheds more light onto what otherwise might be oversimplified as a simple budget-constraint argument that fails to account for the value created in the uncertainty of the process.

 

 

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