Today, suddenly more and more parents in our neighborhood are encouraging their children to fall in love! Yes, they no longer escort their daughters to the tuition classes. Most of them send their children to co-ed schools and colleges. They no longer threat their children with dire consequences if they are caught having an affair (unless it is with the same sex). And most importantly, they are increasingly giving their sons and daughters the freedom to choose their life-partners themselves. Is this the reason of their changed outlook? Can there be some economics behind this? This article actually hunts some economic rationale behind these changes in attitude.
I am heavily inspired by the paper, "The Market for Lemons: Quality Uncertainty and the Market Mechanism" by economist George Akerlof. It discusses information asymmetry, which occurs when the seller knows more about a product than the buyer. The paper is discussed below in brief in order to develop the idea.
The paper by Akerlof describes how the interaction between quality heterogeneity and asymmetrical information can lead to the disappearance of a market where guarantees are indefinite. In this model, as quality is undistinguishable beforehand by the buyer (due to the asymmetry of information); incentives exist for the seller to pass off a low-quality good as a higher-quality one.
The buyer, however, takes this incentive into consideration, and takes the quality of the good to be uncertain. Only the average quality of the good will be considered, which in turn will have the side effect that goods that are above average in terms of quality will be driven out of the market. This mechanism is repeated until a no-trade equilibrium is reached.
As a consequence of the mechanism described in this paper, markets may fail to exist altogether in certain situations involving quality uncertainty. Examples include the market for used cars, the dearth of formal credit markets in developing countries and the unavailability of health insurance for the elderly. We encountered such a mechanism in India in 1970 in the market for fresh milk. Because so many merchants watered down their milk to increase their profits, buyers could not assess the milk’s butterfat content, the low-quality milk drove out the high-quality milk. The Indian National Dairy Development Board provided machines to measure butterfat content and created brand names to build buyers' trust in the milk they were buying. As a result, the quality of milk available in India improved.
But can this mechanism be applied to the ‘Marriage market’ in India? Certainly, the same economics’ keywords cannot be used for this market, and even ‘Marriage market’ may sound insulting. Leave alone the terms ‘buyers’, ‘sellers’, and ‘used’. However the general theme can be interpreted and compared with the mechanism described above. We proceed keeping these facts in mind.
Let us assume that a boy or a girl can get married in two different ways. They can fall in love with her school/college/workplace sweetheart and can choose them as life-partner in period 1. If they do not fall in love in the first period, then in the beginning of the second period a prospective partner is selected for the boy/girl whom they marry (arranged marriage, that is). We rule out all the intermediate cases and arranged marriage for the bride and groom in period 1.
We also assume that a boy and a girl falls in love with each other and gets attracted to the opposite gender on the basis of certain characteristics like physical attributes, culture, attitude, occupation, family background and others. Also let these be the same attributes that the prospective brides and grooms consider for an arranged marriage. Based on these attributes the boys and girls of marriageable age can be categorized into two classes, H and L, where H refers to the categories of boys and girls possessing the superior attributes compared to their less gifted counterparts L. One needs sufficient amount of time and interaction to assess which the type to which another person belongs. Both the type of boys and girls will wish to marry the H category boys and girls off course.
Now, if the boys and girls could not find their life partner in period 1, they are subjected to arranged marriage in period 2. But, in case of arranged marriage the prospective bride and grooms may belong to any category H or L. And unlike in love marriage, the prospective brides and grooms cannot know the exact category or type of their prospective life partner, because they do not get sufficient time to assess their type. Thus chances are there that the L type may masquerade themselves as H type. But the prospective brides and grooms are aware of this fact and H type will not be willing to go for arranged marriage, and would rather go for love marriage. Ultimately, this will drive all the H type boys and girls from going for arranged marriage, who would be better off marrying their own choice in period 1. So only the L categories will be left for the arranged marriage.
This may be a reason, why more and more youth are going for a love marriage, and are getting the support from their parents. So now we have another reason for falling in love…
I am heavily inspired by the paper, "The Market for Lemons: Quality Uncertainty and the Market Mechanism" by economist George Akerlof. It discusses information asymmetry, which occurs when the seller knows more about a product than the buyer. The paper is discussed below in brief in order to develop the idea.
The paper by Akerlof describes how the interaction between quality heterogeneity and asymmetrical information can lead to the disappearance of a market where guarantees are indefinite. In this model, as quality is undistinguishable beforehand by the buyer (due to the asymmetry of information); incentives exist for the seller to pass off a low-quality good as a higher-quality one.
The buyer, however, takes this incentive into consideration, and takes the quality of the good to be uncertain. Only the average quality of the good will be considered, which in turn will have the side effect that goods that are above average in terms of quality will be driven out of the market. This mechanism is repeated until a no-trade equilibrium is reached.
As a consequence of the mechanism described in this paper, markets may fail to exist altogether in certain situations involving quality uncertainty. Examples include the market for used cars, the dearth of formal credit markets in developing countries and the unavailability of health insurance for the elderly. We encountered such a mechanism in India in 1970 in the market for fresh milk. Because so many merchants watered down their milk to increase their profits, buyers could not assess the milk’s butterfat content, the low-quality milk drove out the high-quality milk. The Indian National Dairy Development Board provided machines to measure butterfat content and created brand names to build buyers' trust in the milk they were buying. As a result, the quality of milk available in India improved.
But can this mechanism be applied to the ‘Marriage market’ in India? Certainly, the same economics’ keywords cannot be used for this market, and even ‘Marriage market’ may sound insulting. Leave alone the terms ‘buyers’, ‘sellers’, and ‘used’. However the general theme can be interpreted and compared with the mechanism described above. We proceed keeping these facts in mind.
Let us assume that a boy or a girl can get married in two different ways. They can fall in love with her school/college/workplace sweetheart and can choose them as life-partner in period 1. If they do not fall in love in the first period, then in the beginning of the second period a prospective partner is selected for the boy/girl whom they marry (arranged marriage, that is). We rule out all the intermediate cases and arranged marriage for the bride and groom in period 1.
We also assume that a boy and a girl falls in love with each other and gets attracted to the opposite gender on the basis of certain characteristics like physical attributes, culture, attitude, occupation, family background and others. Also let these be the same attributes that the prospective brides and grooms consider for an arranged marriage. Based on these attributes the boys and girls of marriageable age can be categorized into two classes, H and L, where H refers to the categories of boys and girls possessing the superior attributes compared to their less gifted counterparts L. One needs sufficient amount of time and interaction to assess which the type to which another person belongs. Both the type of boys and girls will wish to marry the H category boys and girls off course.
Now, if the boys and girls could not find their life partner in period 1, they are subjected to arranged marriage in period 2. But, in case of arranged marriage the prospective bride and grooms may belong to any category H or L. And unlike in love marriage, the prospective brides and grooms cannot know the exact category or type of their prospective life partner, because they do not get sufficient time to assess their type. Thus chances are there that the L type may masquerade themselves as H type. But the prospective brides and grooms are aware of this fact and H type will not be willing to go for arranged marriage, and would rather go for love marriage. Ultimately, this will drive all the H type boys and girls from going for arranged marriage, who would be better off marrying their own choice in period 1. So only the L categories will be left for the arranged marriage.
This may be a reason, why more and more youth are going for a love marriage, and are getting the support from their parents. So now we have another reason for falling in love…
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