Effects of Marriage on Family Economic Well-Being. Overview

07/01/2002

This four-paper series by Dr. Robert Lerman(2) examines the economic returns to marriage. The first paper reviews the rich array of literature on this topic, and the remaining three papers present new empirical findings using three different data sets and a variety of statistical models.

One goal in undertaking the empirical research was to address two gaps evident in the literature review. One such gap is the relative scarcity of findings pertaining specifically to economically disadvantaged families. All three empirical papers pay particular attention to findings for disadvantaged families (examined using such measures as low income and low education level). Another gap in the existing research is the difficulty in controlling for selection into marriage when measuring the returns to marriage. In other words, are people with greater economic potential also more likely to get married? If so, this could overestimate the benefits of marriage if not controlled for. This issue is examined primarily in the final paper of the series.

Lerman begins by reviewing the theoretical models of the returns to marriage and points out that one cannot conclude a priori that married parent families are economically better off, particularly when compared to cohabiting parent families who also have two potential earners. He lays out a framework for testing empirically whether married parents are better off than other parents, with particular emphasis on comparison to cohabiting parents. Each paper’s contribution to this question is unique, based on the strengths of the particular data. Taken together, the results in these three papers generally provide a robust indication that married parents tend to be better off than both single and cohabiting parents, and that these benefits extend to disadvantaged families as well. The findings of each of the three empirical studies are summarized below.

The first paper detailed below uses the National Survey of America’s Families to examine the types of union formation among families and their relationship to well-being. One strength of these data is the ability to identify detailed family groups according to marital and biological status of parents. Lerman finds that married parent families with two-biological parents have lower rates of poverty and material hardship, even after controlling for other related factors, and even among families with lower education or lower incomes.

The second paper highlighted below uses the Survey of Income and Program Participation to replicate and expand upon the analysis of material hardship. In this paper, Lerman also incorporates findings on the importance of stability of income and household composition over time. His findings continue to indicate that marriage reduces the risk of hardship, even among those with lower incomes or lower education. The results further suggests that one reason for this outcome may be that married parents have more stable unions and have greater access to assistance from friends, family and community. In addition to measures of material hardship, the paper also examines well-being in terms of income-to-needs ratios, or welfare ratios.(3)

The final paper reviewed below uses data from the National Longitudinal Survey of Youth and examines poverty and welfare ratios as the primary indicator of well-being. Measures of potential disadvantage include premarital pregnancy and aptitude scores. The longitudinal nature of the data support analyses of longer-term measures of well-being and the ability to control for more characteristics of the mother prior to the birth. The author also uses techniques such as propensity matching scores and fixed effects models to control for selection into marriage. His conclusions are generally consistent with the first two papers; that marriage improves economic well-being, even among disadvantaged families and minority families.