Specialization and competition in marriage models [An article from: Journal of Economic Behavior and Organization]

This digital document is a journal article from Journal of Economic Behavior and Organization, published by Elsevier in 2007. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.

Description:
I present a marriage model that includes pre-marital investments in human capital. Individuals expect the future role specialization in marriage (the specialization effect): but at the same time, before marriage, individuals have the incentive to invest in order to make themselves more attractive (the competition effect). The interaction of two effects generates multiple equilibria. No equilibria are ex ante efficient when the benefits of role specialization exist. The competition effect is a source of coordination failure in the match formation. This result stands in contrast to those of other models in which the competition effect leads to efficiency in some equilibrium.