MARRIAGE AND THE FAMILLY:

1
MARRIAGE AND THE FAMILLY

• Economic Issues and Application
• Chapter 4

2
RACE AND FAMILY STRUCTURE

• Does Race Impact Households forming a Family
• The Answer is YES
• It can be seen in your text, Table 4.1

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RACE DIFFERENCES IN MARITAL AND FAMILY STATUS,
2002
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RACE DIFFERENCES IN MARITAL AND FAMILY STATUS

• This difference leads to two questions
• When did these differences develop?
• Why did they develop?
• It is clear from the graph in your text Fig 4.1
  that there has been a big difference in the
  percentage of married women since 1950

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PROPORTION OF WOMEN AGE 15 AND OLDER, MARRIED, BY
RACE, 1950-2002
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RACE DIFFERENCES IN MARITAL AND FAMILY STATUS

• Clearly in the mid 60s thru perhaps the 1980s
• So then the question is WHY?
• One possibility is the Rate of Divorce
• The graph 4.2 in your text

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CHANGES IN THE MARITAL STATUS OF BLACK WOMEN,
1950-2002
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RACE DIFFERENCES IN MARITAL AND FAMILY STATUS

• Clearly it appears the NEVER MARRIED accounts for
  more than the Divorced category
• Furthermore Female Householders Increased.
• Or in other words, number of children raised in
  two parent household decrease during this same
  period

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CHILDREN UNDER AGE 18 IN TWO-PARENT FAMILIES BY
RACE, 1960-2002
90 80 70 60 50 40 30
WHITE BLACK
1960 1970 1980 1990
2000
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Is family structure an Economic Issue

• Family structure is currently a very heated
  social issue
• It has some economic implications in that some
  structures are likely to have a given economic
  status
• Again from your text table 4.2

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FAMILY INCOME AND POVERTY STATUS OF INDIVIDUALS
BY FAMILY STRUCTURE AND RACE, 2000
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Economic Explanations for the Divergence in the
Marital Status of White and Blacks

• Marriage Market
• Womens Wage Rates
• The Welfare System

13
Marriage Market

• In Chapter 3, we saw that there is a surplus of
  White Males (shortage of white females) and
• A surplus of Black and Hispanic females (shortage
  of Black and Hispanic males)
• That comparison however, may not be specific
  enough to determine the marriage market

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Marriage Market

• Mid 1980s sociologist William Julius Wilson wrote
  two books that become standard in the literature
  The Truly Disadvantage and When Work Disappears.\
• In The Truly Disadvantage he argues that low
  skilled jobs decreased and consequently the job
  prospects of many Black Males decreased
• Consequently, the marriage prospects of Black
  females decrease as well

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Marriage Market

• William Julius Wilson developed
• the Male Marriageable Pool Index

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MMPIs BY AGE, RACE, AND YEAR
17
THE MMPI AND THE PROPORTION OF FAMILIES HEADED BY
WOMEN, 1960-80, BY RACE
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Womens Wage Rates

• The impact can be
• The closer female/male wage ratio the less the
  benefits for the female (and even the male) from
  marriage
• Higher the female wages the higher the
  opportunity cost of marriage
• An example of this can be found in the data from
  Mexico presented below

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Women Marital StatusIn Mexico
20
Women Marital StatusIn the State of Baja
California
21
Women Marital StatusIn the State of San Luis
Potosi
22
Not Married Women
23
Married by Type of Marriage
24
Non-Married Status(other than never married)
25
The Welfare System

• Welfare system in the US has its broad origins in
  the Social Security Act of 1935
• At the time, a program labeled ADC (Aid to
  Dependent Children)
• The Program was later changed to AFDC (Aid to
  Families with Dependent Children)

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The Welfare System

• It was not until the late 1950s that the Federal
  Government started to reimburse states for
  participating in AFDC
• In the 1960s as part of the War on Poverty the
  program was expanded and increased the number of
  individuals eligible

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The NEW Welfare

• In 1994, in part due to the public sentiment that
  was voiced by the Clinton Administration
• TANF (Temporary Assistance Needy Families)
  substitute AFDC

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PROPORTION OF WOMEN AGE 15 AND OLDER, MARRIED, BY
RACE, 1950-2002
Note the Increase
29
Marriage and the Earnings of Men

• Married men generally earn more income that
  single man
• Even after taking many factors that would be
  impacting the difference
• So it has received the name of
• The Male Marriage Premium

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Marriage and the Earnings of Men

• There may be several reason
• The MPL may be the same but employers pay married
  man more. This may be possible but not likely in
  a competitive market
• Two other reasons are based on the assumption
  that MPL (MARRIED) gt MPL (SINGLE)

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Marriage and the Earnings of Men

• MARRIAGE PRODUCTIVITY EFFECT. Here the economies
  of scale at the household level allows men to
  become more specialized at the work palce
• MARRIAGE SELECTIVITY EFFECT. Here the assumption
  is that holding all other things constant, men
  that married tend to be more industrious, more
  responsible, more courteous, etx

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Marriage and the Earnings of Men

• Korenman and Neumark found that about the The
  Male Marriage Premium was about 11
• With about 6 of the 11 coming from the MARRIAGE
  PRODUCTIVITY EFFECT and the remained from the
  MARRIAGE SELECTIVITY EFFECT

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Divorce

• There can be gains and losses
• In an economic sense, divorce is the decision of
  the opportunity cost between remaining married
  and become single again
• Again from your Text Table 4.5

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ILLUSTRATIVE ANALYSIS OF GAINS TO DIVORCE
35
UNCERTANTY, THE GAINS TO MARRIAGE, AND DIVORCE