Dollars and Sex

1. Economic forces shape sexual behavior and relationships

"I argue that almost every option, every decision, and every outcome in matters of sex and love is better understood by thinking within an economic framework."

Supply and demand in relationships. Economic principles apply to our romantic lives, influencing everything from casual hookups to long-term partnerships. The "price" of sex and love is determined by factors such as:

• Availability of potential partners
• Individual "market value" based on attributes like attractiveness, income, and education
• Costs and benefits of different relationship arrangements

Changing norms over time. Economic developments have transformed sexual behavior:

• Contraception reduced the "cost" of premarital sex
• Women's increased economic independence altered marriage dynamics
• Technology lowered search costs for finding partners

These shifts explain trends like delayed marriage, increased cohabitation, and changing attitudes towards casual sex.

2. Online dating transforms mate selection and market dynamics

"Online searches encourage us to find qualities that are easy to measure: age, height, education, race, income, etc. The quality of a relationship, however, is more about experiential qualities than it is about empirical qualities, and those are much harder to quantify and to search for online."

A thicker market. Online dating has dramatically expanded the pool of potential partners, creating a "thicker" market with more options. This leads to:

• More efficient matching based on preferences
• Potentially higher-quality relationships due to better selection

Unintended consequences. However, the nature of online platforms can also:

• Encourage excessive filtering based on superficial criteria
• Create unrealistic expectations due to seemingly endless options
• Lead to "choice overload" and decision paralysis

Data-driven insights. Online dating has provided researchers with vast amounts of data on mate preferences, revealing patterns in how people select partners based on factors like race, education, and physical appearance.

3. Education and income inequality influence marriage patterns

"As the incomes of wealthy households increase, everyone spends more in an attempt to keep up with their consumption."

Assortative mating. People increasingly marry others with similar education and income levels, contributing to overall inequality:

• College-educated individuals are more likely to marry each other
• This concentrates high incomes within households

Delayed marriage. Rising inequality and economic pressures affect marriage timing:

• Young adults delay marriage to establish careers and financial stability
• This trend is more pronounced among those with higher education

Marriage gap. A growing "marriage gap" has emerged between socioeconomic classes:

• Marriage rates are higher among the college-educated and affluent
• Lower-income individuals are less likely to marry, partly due to economic instability

These patterns can perpetuate and exacerbate existing inequalities across generations.

4. Bargaining power in relationships depends on economic factors

"Having more education and a higher wage may make it easier for married women to leave an unhappy marriage, but does that imply that higher rates of education for women are responsible for high divorce rates?"

Shifting dynamics. As women's economic opportunities have increased, relationship bargaining power has evolved:

• Women's ability to support themselves financially provides leverage
• This can lead to more egalitarian decision-making in relationships

Factors affecting bargaining power:

• Income and earning potential
• Education level
• Age (especially in age-gap relationships)
• Attractiveness and perceived "market value"

Implications for relationship stability. Changes in bargaining power can affect:

• Division of household labor
• Financial decision-making
• Overall relationship satisfaction and stability

While increased female bargaining power hasn't necessarily led to higher divorce rates, it has changed the nature of marital negotiations and expectations.

5. Infidelity is an economic decision with costs and benefits

"Men and women cheat in marriage because they believe at the outset that the benefit of doing so outweighs the expected costs."

Cost-benefit analysis. The decision to cheat involves weighing:

• Potential benefits: sexual satisfaction, emotional fulfillment, ego boost
• Potential costs: risk of discovery, relationship damage, financial penalties

Factors influencing infidelity:

• Income and financial independence
• Occupation and opportunities for extramarital encounters
• Age and perceived attractiveness
• Relationship satisfaction

Gender differences. Contrary to popular belief:

• Higher-income women are less likely to cheat than lower-income women
• Men's likelihood of cheating isn't strongly correlated with income
• Power and status increase infidelity likelihood for both genders

Understanding infidelity through an economic lens doesn't justify the behavior but provides insights into its occurrence and potential prevention strategies.

6. Teenage sexuality is affected by economic opportunities

"There is a relationship between the economic environment and what societies believe to be socially acceptable adolescent sexual behavior."

Future prospects influence behavior. Teenagers' sexual decisions are shaped by their perceived economic opportunities:

• Those with higher education expectations tend to delay sexual activity
• Limited economic prospects can lead to earlier sexual debut and teen pregnancy

Education and contraception use. Access to affordable education affects sexual behavior:

• Lower college tuition is associated with fewer sexual partners among teens
• Expectation of attending college increases contraception use

Inequality and "culture of despair". High income inequality can create a "culture of despair" among disadvantaged youth:

• Reduced perceived costs of early parenthood if upward mobility seems unlikely
• This partly explains higher teen pregnancy rates in areas with high inequality

Addressing teenage sexuality requires considering not just health education, but also broader economic factors and opportunities.

7. Later-life dating markets are growing due to demographic shifts

"Markets, as I have already said, can be described as being thick or thin. When markets are thin, there are few buyers and sellers—it is harder to arrive at price at which both buyers and sellers are willing to engage in trade—and few transactions take place. When the market is thick, however, there are many buyers and sellers, meaning that equilibrium is easier to achieve—buyers and sellers can settle on a market price at which they both want to trade—and more transactions take place."

A thicker market. The late-in-life dating market has expanded due to several factors:

• Increased life expectancy
• Higher divorce rates
• Changing social norms around senior sexuality

Technology adoption. Older adults are increasingly using online dating platforms:

• This expands their pool of potential partners
• It reduces search costs, which were traditionally higher for older daters

Changing preferences. Traditional assumptions about older daters are being challenged:

• Many older women prefer casual relationships to long-term commitments
• Age gaps in relationships are becoming more acceptable, including "cougar" relationships

Health considerations. STD rates are rising among older adults:

• Less concern about pregnancy can lead to riskier behavior
• There's a need for targeted sexual health education for this demographic

The growth of this market challenges stereotypes about aging and sexuality, while also presenting new opportunities and challenges for older adults seeking companionship.

Last updated: March 24, 2025