Friday, August 17, 2007


In chapter 21 of Price Theory, professor David Friedman wrote a perfect analysis of economics regarding love relationship and marriage. The aspects exposed in the text are interesting especially because the notable difference between sociological and economic view of decisions about love and marriage is seen very succinctly.

From my point of view, youth love is an investment to gain the experience before you invest in marriage as a firm, with obvious reasons for household production. In the model, the marriage is defined as an ordinary price market, contrary to standard marriage contract. In the given model, the supply and demand behave as usually, if the quantity of future wives supplied in the market is lower, and the quantity demanded higher, then there is a higher price which a husband has to pay. If a model is entirely symmetrical, it can easily be spoken of husbands supplied and demanded.

As marriages are monogamous, the number of husbands supplied and demanded is the same, since a man seeking to become a husband is a man seeking to obtain a women, just as on the barter market, where someone who offers to trade whiskey for wine, is demanding wine and supplying whiskey. It should be noted that when an economist analyzes marriages and love in general, not everyone has the same tastes as hidden and revealed prefereces vary. On the other hand, divorce could be taken as a price for obtaining another women, since men are worse off in this particular regard because their price edge will be higher as his supply surplus is reduced.

Overall, the chapter can be a great summer reading and yet it is another proof that the application of economic analysis into every walk of life is possible and it delivers very interesting results, regarding the decisions about love and marriage, both as price-taking and investment.

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