Premium
UNOBSERVABLE INDIVIDUAL EFFECTS, MARRIAGE AND THE EARNINGS OF YOUNG MEN
Author(s) -
CORNWELL CHRISTOPHER,
RUPERT PETER
Publication year - 1997
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1997.tb01910.x
Subject(s) - unobservable , earnings , economics , productivity , national longitudinal surveys , demographic economics , panel data , labour economics , interpretation (philosophy) , wage , econometrics , macroeconomics , accounting , computer science , programming language
While there is compelling evidence that married men earn more than unmarried men, the source of this premium remains unsettled. Using panel data from the National Longitudinal Survey of Young Men, we show that much of the premium normally attributed to marriage is associated with unobservable individual effects that are correlated with marital status and wages. To the extent there is a gain, it is purely an intercept shift and no more than 5% to 7%. Our findings cast doubt on the interpretation that marriage enhances productivity through specialization.