Wednesday, 13 November 2013

Relationship-specific investments

I spend a week on sex, love and economics in my Econ & Current Policy Issues class. I there note that one function of marriage is the encouragement of relationship-specific investments.

Suppose that you have two broad classes of action for an hour's worth of free time. You can invest in an activity that will increase your value to other potential partners, or you can spend your time on something that wouldn't be noticed by outsiders but provides a lot of value within the relationship. If you think that your relationship will be short-lived, you do more of the former; if you think it'll last, you do more of the latter in hopes of reciprocation. The principle's pretty general: employers might not want employees to think they're for the chopping-block if they want employees to pay attention to those bits of the job that matter but aren't measured. Any time you want to induce effort in the provision of relationship-specific goods, you need some assurance of a longer-term commitment.

Today's bit of evidence comes from a new survey of dating data. Women in longer term relationships are more satisfied with some aspects of the partner's performance than are those in short-term hook-ups. There will be a bit of sampling bias built-in here: those in long-term relationships are those who've found good matches while those in short-term ones are less likely to have found their match. But the data's consistent with what we'd tend to expect from base theory.

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