An Investment-and-Marriage Model with Differential Fecundity

Abstract

I build an equilibrium investment-and-marriage model with differential fecundity to explain stylized facts about education, income, and marriage for Americans born in the twentieth century that had not been explained in a unified way. The most novel finding is an explanation for why women attend college at a higher rate and earn a lower average income than men. Differential fecundity and an equilibrium marriage market form the basis of my explanation. The model also accounts for gender-specific relationships between age at marriage and income, and the evolving relationship between age at marriage and spousal income for women. I provide evidence to support my theory and calibrate the model to conduct counterfactual analyses.