Applied Economics Letters, 2007, 14, 4952

Optimal dynamic path of effort on marriage: differences between arranged and love marriages
Xuemei Liu
California State University, Long Beach, CA 90840, USA E-mail: xliu@csulb.edu

People benefit from good marriages. Thus, everyone is willing to put effort into marriage to improve the quality of marriage. However, effort is costly. Then everyone faces the same question: how much effort should I put into marriage? A dynamic optimal control model is used in trying to answer this question. The study shows that for arranged marriages that start with little love, an agent should devote a great deal of effort to marriage in the very beginning, and then reduce the effort until a steady state level. However, for love marriages that start with deep love, there is no need for an agent to devote as much effort as in the steady state. The agent should start to put low effort on marriage, high effort on other activities, and continuously increase the effort on marriage up to the steady state level.

I. Introduction Since Becker (1973) started to apply economic analysis on marriage issues, there are many economic studies on how people make decisions on marriage and divorce, for example, Peters (1986), Batabyal (1999) and Cornelius (2003). However, economists have contributed very little to the understanding of how people devote effort to marriages. The purpose of this study is to provide a theoretical framework to analyse how an agent devotes effort to marriage over the lifetime in order to derive the highest utility from marriage. People benefit from good marriages. Thus, everyone is willing to put physical and emotional effort on marriage to improve the quality of the marriage. However, effort is costly because it demands time and energy. When one devotes effort to marriage, he or she has to forgo the opportunities of doing other activities, such as work or enjoying time with friends. Therefore, it would not be wise or even possible for one to devote all his or her effort to marriage.

Since more is not necessarily better, then everyone faces the question: how much effort should I put on marriage? The study is trying to answer this question by using a dynamic optimal control model. It is assumed people are utility maximizers. They derive utility from marriage and other activities. In addition, it is assumed people wish to stick with marriage for the rest of their lives. Then what people care is the overall lifetime utility they can derive from marriage instead of the utility in a single period. Since this is a dynamic decision, the optimal effort path depends on the initial status of marriage. Marriages start for a variety of reasons. Some are for love, some for needs, and most for some combination of both. This study categorizes marriages into two types depending on the initial status. If one gets married with love, the initial quality of marriage is high. I refer to this type as love marriage. Love marriage is more observed than the arranged one in western cultures, where people have the choices between love and arranged marriages
49

Applied Economics Letters ISSN 13504851 print/ISSN 14664291 online 2007 Taylor & Francis http://www.tandf.co.uk/journals DOI: 10.1080/13504850500425691

50
(Batabyal and Beladi, 2002), they could convert an intended arranged marriage into a love one. If one gets married with little love of his or her spouse, the initial quality of marriage is low. I refer to, this type as arranged marriage. In poor countries, especially in remote rural areas, arranged marriage is still common. Many people get married with little love or even hardly knowing their spouses. However, marriages starting with deep love may not last long, while marriages starting with little love may last for a life-long time and with good quality. The duration and quality of a marriage are determined by many factors, among which some are uncontrollable and some are controllable. If a marriage fails due to uncontrollable reasons, there is nothing one can do about it. What one can do to improve the quality of his or her marriage is by doing the controllable things in an optimal way. This study examines what the optimal way is. Next section develops the model. The last section concludes.

X. Liu
Therefore, the cost of effort is the forgone utility from other activities, which is represented by the cost function C(u). Then the net benefit the agent can derive from marriage in each period of time is the difference between B(x) and C(u). Following traditional assumptions, it is assumed B00 (x) < 0 and C00 (u) > 0. At the beginning of marriage, the agent wishes to stick with marriage for the rest of life. Thus, the agent wants to maximize the total discounted future utility by choosing the effort u(t) in each period. Thus, the problem is written as: Z1 ert Bxt Cut max
ut 0

subject to: xt ut bxt x0 x0 1

II. The model In this dynamic optimal control model, the objective of the agent is to maximize the total discounted future utilities derived from marriage. The choice variable is the effort on marriage in each period of time. The stock variable is the stock of marriage capital, which primarily determines the duration and quality of marriage. It is assumed the initial level of stock is low for arranged marriages and high for love marriages. Let u(t) denote the effort the agent puts on marriage in each period of time. Let x(t) denote the marriage capital stock in each period of time. Let b denote the decay rate of marriage stock, which is the fraction of marriage stock that wears out in each period of time. This decay may be caused by uncontrollable factors, such as the spouses effort and attractions from outside marriage. Thus the change of x(t) is the difference between u(t) and bx(t). The agent derives satisfaction from marriage. Higher marriage stock makes the quality of marriage higher, which in turn makes the agent happier. Let B(x) represent the benefit function that describes the relationship between the utility the agent derives from marriage and the marriage stock. Besides marriage, the agent also derives satisfaction from other activities. When the agent puts effort on marriage, the utility that could have been derived from other activities is forgone.

where r is discount rate, which represents the agents time preference. x0 is the initial stock of marriage capital, with x0 xL for arranged marriage, and x0 xH for love marriage. The current value Hamiltonian is H Bxt Cut ut bxt where  is the current value costate variable. Effort leads to higher quality of marriage, thus  is positive. Suppressing the argument t, the necessary conditions are obtained: Hu C0 u   @H r B0 x r b @x 2 3

Totally differentiating Equation 2 with respect to t, one obtains C00 uu  Combining Equations 3 and 4 yields C00 uu B0 x b r Combining Equations 2 and 5 yields C00 uu B0 x b rc0 u which can be written as u B0 x b rC0 u C00 u 6 5 4

At steady state, u 0. Then Equation 6 implies b rC0 u B0 x 0 7

Optimal dynamic path of effort on marriage

Totally differentiating Equation 7 yields b rC udu B xdx 0 which implies du B00 x dx b rC00 u Since B00 x < 0, and C00 u > 0, then one obtains du/dx < 0, which implies that the isocline u 0 is downward sloping. From the motion equation x u bx, one knows that at the steady state, x u bx 0. Thus, the isocline x 0 is upward sloping. Figure 1 shows the phase diagram in the statecontrol space. The horizontal axis shows the marriage stock, and the vertical axis shows the effort on marriage. x* and u* are the steady state levels of stock and effort. This steady state is stable (see proof in Appendix A). Once the effort and marriage stock reach the steady state levels, the agent should put the same amount of effort on marriage in each period and will live with the same quality of marriage in the rest of life. However, before the agent reaches the steady state, the optimal dynamic path of effort depends on the initial status of the marriage. For the case of love marriage, the initial marriage capital stock is x0 xH , which is higher than the steady state level. Figure 1 shows that the optimal saddle path is the one starting from xH and going towards x*. This path means that the agent with high marriage capital stock should start with low effort and continuously increase the effort up to the steady state level. This trajectory implies that if the agent marries with love, it would not be wise for him to devote very high level of effort to marriage at the beginning to maintain such high level of marriage stock. Although the agent derives happiness from
00 00

51
high level of marriage stock, happiness increases with the stock of marriage at a decreasing rate, and the cost of effort, which is needed to maintain a high level of marriage stock, increases with effort at an increasing rate. Therefore, the best strategy for love marriage is that the agent puts less effort on marriage and more effort on other activities, such as work and study, in the beginning. Then the highest utility will be achieved over the lifetime by gradually increasing the effort on marriage. For the case of engaged marriage, the initial marriage capital stock is x0 xL , which is lower than the steady state level. Figure 1 shows that the optimal saddle path is the one starting from xL and going towards x*. This path means that the agent with low marriage capital stock should start with a level of effort that is much higher than the steady state level and continuously reduce the effort down to the steady state level. This trajectory implies that if the agent marries with little love, it would be necessary to devote very high level of effort to marriage at the very beginning in order to increase the marriage stock to the level from which enough utility can be derived. Therefore, even though some people marry with little love, they still can manage to have happy marriages in the rest of life by devoting enough effort to marriage in the early years.

III. Conclusions Newly married people tend to be willing to devote more effort to their marriages than old couples. This strategy, however, is not ideal for all marriages, based on the theoretical framework. By devoting effort to marriage, an agent has to forgo the opportunities of enjoying other activities, such as work. Thus, it would not be wise for all people to devote the same amount of effort to marriages, or to devote the same amount of effort in every period of time. The study shows that for arranged marriages that start with little love, the agent should devote very high effort to marriage in the very beginning, and continuously reduce the effort down to the steady state level. However, for love marriages that start with deep love, there is no need for an agent to devote much effort in the beginning. The agent should start to put low effort on marriage, high on other activities, and continuously increase the effort on marriage up to the steady state.

x=0

u*

u=0 x xL x* xH

Fig. 1.

The phase diagram in the state-control space

52
References
Batabyal, A. A. (1999) A dynamic and stochastic analysis of decision making in arranged marriages, Applied Economics Letters, 6, 43942. Batabyal, A. A. and Beladi, H. (2002) Arranged or love marriage? That is the question, Applied Economics Letters, 9, 8937. Becker, G. S. (1973) A theory of marriage: Part I, Journal of Political Economy, 81, 81346. Cornelius, T. J. (2003) A search model of marriage and divorce, Review of Economic Dynamics, 6, 13555. Peters, H. E. (1986) Marriage and divorce: informational constraints and private contracting, The American Economic Review, 76, 43754.

X. Liu
of Equations 1 and 6 around the steady state x* and u*, the approximating linear differential equation system is obtained: 0 1     b 1 x 00 A x @ B x br u u C00 u The determinant is B00 x <0 C00 u

jAj bb r Appendix A: Determining the Stability of the Steady State To determine the stability of the steady state, the nonlinear system is linearized at the steady state. Taking the linear terms of the Taylor series expansion

Since the determinant equals the product of the eigenvalues, one can conclude that there is one positive and one negative eigenvalue; that is, the equilibrium is a saddle point. The steady state is stable.