The marriage consumption puzzle—evidence from China

Abstract

ABSTRACT Marriage, as the most crucial event in one’s lifetime, not only has a significant effect on one’s future consumer preferences but also changes one’s consumer decisions. This paper addresses how individuals change their expenditure when the marital status changes, three models are developed to explore this issue based on the equilibrium of current consumption and consumption purpose with the consideration of income growth, expenditure on public goods and mating competitiveness for males and females. By selecting the married group in the panel data of China Family Panel Studies between 2016 and 2018, we use the propensity score to match all the married individuals during the 2 years and search a control group for each of them and, in addition, use the difference-in-differences (DID) method to examine the effects of marriage on individuals’ personal and public consumption. Benefiting to the model fitting the data relatively well, the results show that individual’s expenditure raises by 24% when married, with highly increasing items in public goods. At last, males cost 11.4% more than females after their marriage.