WHY DO MARRIED MEN EARN MORE THAN UNMARRIED MEN

Previous research reported that married men, ceteris paribus, earn more than unmarried men. A variety of explanations have been suggested for this association. One class of explanation argues that wives, for various reasons, increase their husbands' wages. Another class of explanation maintains that the causality is reversed, that is, high wage men are more likely to get married than low income men. Yet a third possibility is that unobserved characteristics, affecting both wages and marital status, are the reason for the observed cross-sectional association between marital status and wages. This paper presents a longitudinal model suitable for testing these explanations. The use of the model is illustrated by analyzing the wages and marital status of a large sample of men drawn from the Panel Study of Income Dynamics. Significant cross-sectional effects of marital status on wages and vice versa disappeared when the longitudinal model was employed. This suggests that omitted variables affecting both wages and marital status, rather than the former explanations, are responsible for the higher wages of married men. © 1991.