The Effect of Declining Marriage Prospects on Young Men's Labor-Force Participation Rate

Abstract

Why have so many young men left the U.S. workforce? This paper develops a model in which men earn a marriage market return on past employment. It hypothesizes that this return declined as gender-role-specialized marriage became a less efficient arrangement. It establishes causal evidence for this hypothesis by identifying two shocks that lowered the returns to gender role specialization: growth in female employment opportunities across U.S. commuting zones from 1980-2016, and unilateral divorce regime transitions across U.S. states in the 1970s. These shocks reduce marriage and labor-force participation (LFP) among young men without college and can account for 1/4 of their long-run LFP decline. Policy implications of these results are discussed.

Keywords: labor-force participation, marriage market, human capital investment, bargaining power, household specialization, Bartik shock, unilateral divorce

JEL Classification: E24, J12, J21, J22, J24