Investment in Schooling and the Marriage Market

52 Pages Posted: 30 Nov 2006  

Pierre-Andre Chiappori

Columbia University - Graduate School of Arts and Sciences, Department of Economics

Murat Iyigun

University of Colorado at Boulder - Department of Economics; Harvard University - Center for International Development (CID); IZA Institute of Labor Economics

Yoram Weiss

Tel Aviv University - Eitan Berglas School of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Date Written: November 2006

Abstract

We present a model with pre-marital schooling investment, endogenous marital matching and spousal specialization in homework and market production. Investment in schooling raises ages and generates two kinds of returns in our framework: a labor-market return and a marriage-market return because education can affect the intra-marital share of the surplus one can extract from marriage. When the returns to education and household roles are gender neutral, men and women educate in equal proportions and there is pure positive assortative matching in the marriage market. But if men and women have different market returns or household roles, then there may be mixing in equilibrium where some educated individuals marry uneducated spouses and those who educate less extract a relatively larger share of the marital surplus. The existence of large and frictionless marriage markets creates competition among potential spouses, precludes bargaining and generates premarital investments that are efficient. Given that the gender wage gap narrows with the level of education, women's labor-market return from schooling is higher than that of men. Moreover, women's household time obligations have declined over time, raising their marriage-market return from schooling. Combining these two effects, we explain why women now attain higher schooling levels than men.

Keywords: pre-marital investments, matching, intra-household allocations

JEL Classification: C78, D61, D70

Suggested Citation

Chiappori, Pierre-Andre and Iyigun, Murat and Weiss, Yoram, Investment in Schooling and the Marriage Market (November 2006). IZA Discussion Paper No. 2454. Available at SSRN: https://ssrn.com/abstract=947518

Pierre-Andre Chiappori

Columbia University - Graduate School of Arts and Sciences, Department of Economics ( email )

420 W. 118th Street
New York, NY 10027
United States

Murat F. Iyigun (Contact Author)

University of Colorado at Boulder - Department of Economics ( email )

Campus Box 256
Boulder, CO 80309
United States
303-492-6653 (Phone)
303-492-8622 (Fax)

Harvard University - Center for International Development (CID) ( email )

One Eliot Street Building
79 JFK Street
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Yoram Weiss

Tel Aviv University - Eitan Berglas School of Economics ( email )

P.O. Box 39040
Ramat Aviv, Tel Aviv, 69978
Israel
+972 3 640 9715 (Phone)
+972 3 640 9908 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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