Sunday, May 31, 2015

How women's education is contributing to income inequality

Of course it's been overall good for society that women have gotten more education and income since WWII, but there are consequences. I couldn't find the Economist article, but they had a chart showing marriage preferences for 1960s America. Men were more likely to marry women of similar education status (which correlates to income), but there was a decent level of "mixed education" households - maybe due to childhood sweethearts, family-encouraged marriages, etc.

In the 21st Century, dual-income households and "assortative mating" has gotten much more common. Now men with HS education almost exclusively marry women of similar status, and same goes for college or grad-school educated men. I guess it makes sense, as the modern American youth is likely to meet his or her mate at school or on the job (or through online dating sites that try to match demos). And of course there are intellectual, geographic, and class compatibility issues that make it less likely for a highly educated person to marry a poorly educated one. But this is resulting in either very rich or very poor households, and it's less likely that a lower-income family can "pull a Cinderella" and increase their wealth/quality of life through marriage.

Of course I'm not blaming women for any of this. Apart from love, I think most of us would recognize the benefits of marrying a more educated/wealthy mate. So professionals marry professionals, and blue collar/service workers marry the same. When controlling for other factors, assortative mating caused the Gini coefficient (inequality metric where 1 = perfect inequality and 0 = no inequality) to rise from 0.34 to 0.43 (+26%) over 1960-2005 in this Pew study's data.

I'm not sure what can be done about this, or if anything should be done. But the IMF and others said that income inequality is the root cause of many structural social problems. Wealthy couples tend to live in better neighborhoods with better schools. Their kids will have health, safety, social, and intellectual advantages vs. lower-income children. They will succeed in college and career, and likely marry a similarly successful person. But all this suggests that overall social mobility is on the decline in the US, with no signs of improvement.

Surprisingly, the GOP presidential candidates have spoken a lot about inequality/pressure on the middle class/American Dream so far. But it's likely lip-service, as they still want to gut social services and cut taxes for the "job creators". Obama and other Democrats have also talked a lot about the minimum wage, workplace sexism, and the unfair playing field. I wonder how much of an issue it will be in 2016, and if we can do anything about the "Great Divide".

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