According to a new study by Betsey Stevenson and Justin Wolfers, professors of business and public policy at Wharton, marriage and divorce rates in the United States are both at historic lows. Specifically, the number of people getting married, which has been falling for the past 25 years, is at its lowest point in recorded history, while the divorce rate in 2005 reached its lowest level since 1970.
When Stevenson and Wolfers began to analyze the changing market forces behind these new statistics, one thing became clear: The same forces that play a role in marriage and divorce statistics -- namely birth control, partial closing of the gender wage gap, the rising age of first marriages and dramatic changes in home technologies -- have also had a significant impact on businesses and employees.
"The factors that changed the landscape of personal relationships and families play out in the workplace, too, since the same people make up both labor markets and families," says Stevenson. "It's always valuable for firms to be aware of the labor market they are dealing with."
No Intent to Procreate
In a paper titled, "Marriage and Divorce: Changes and Their Driving Forces," Stevenson and Wolfers acknowledge that when it comes to marriage, economic models have often tried to explain how and why families form. According to Stevenson, a 1981 "Treatise on the Family" by Nobel-prize winning economist Gary S. Becker proposed a marriage theory based on "production complementarities." In Becker's theory, a husband and wife specialize in the market and domestic spheres, respectively, and hence are more productive together than apart. This division of labor comes in handy in what Stevenson calls the "production and bearing of one's children."
But the two Wharton experts invoke singer-songwriter Bob Dylan's lyrics to The Times They Are A-Changin' to explain why marriage models like Becker's may need to be reconsidered, noting that "the family is not a static institution.
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