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Encouraging Marriage to Drive the Economy

Douglas A. McIntyre

The declining number of marriages gets criticized as a lack of commitment between people, or a challenge to the moral belief that people should not simply live together. Economists argue that marriage also tends to drive up taxes and health care costs. Added to those concerns is another, which is that the economy actually could improve if more Americans would marry instead of turning to alternatives. Perhaps Congress and the administration should look at this evidence and consider whether strong measures should be taken to encourage Americans to marry.

New data from Gallup on marriage rates and the economy show that:

Married Americans spend more than those in any other marital status category, across age groups. Americans who have never married spend significantly less, particularly for those younger than 50, suggesting that if the marriage rate increases, overall spending in the U.S. may increase and benefit the U.S. economy.

The federal government has the chance to boost gross domestic product (GDP), which has flagged for many years, and satisfy a broadly held moral imperative. Marriage could become a place where consumer spending and ethical behavior could meet.

The easiest explanation for the financial benefits is the "two-income household" one. It does not entirely explain the marriage advantage, because so many couples live together. Perhaps the lack of a legal commitment undermines the desire or propensity to spend more. Gallup's analysis of why these differences exist is vague, but its figures are not:

Married Americans spend more than the average American in part because they have higher-than-average incomes. Single Americans spend less, at least in part because they have lower-than-average incomes. Those in domestic partnerships spend almost as much as those who are married, but have lower average incomes, similar to single Americans' incomes, suggesting that domestic partners in some sense overspend what would be predicted from their incomes alone. This hypothesis is supported by additional research showing that those in domestic partnerships have a relatively high rate of spending when income and other demographic factors are controlled for.

Whether or not politicians approve of marriage, the future of GDP may hang in the balance.