Abstract
Each state offers a standard marital contract and controls access to it. Married couples enjoy many benefits under U.S. federal and state laws, such as veteran and military pensions, immigration preference, Social Security payments, and tax deductions. Although many of these benefits were introduced for other purposes, we argue that the growth in welfare programs indirectly increased the value of the marital contract over time. In 2015, the Supreme Court ruled that same-sex couples could now access marital contracts—and consequently the benefits tied to marital status—in all 50 U.S. states. We view the legalization of same-sex marriage as the predictable supply response to an increase in the demand for access to the marital contract, which followed from an increase in its value over time. We test this hypothesis at both state and federal levels. Using cross-sectional data at the state level, we show that variation in state spending on benefits can explain variation in the length of years that same-sex marriage was legalized in a state prior to Obergefell. At the federal level, we show how federal expansions of benefits over time corresponded to increased expenditures on lobbying for same-sex marriage.
Similar content being viewed by others
Notes
Although we do not examine it in detail, the question of why governments standardize the marital contract remains open (Allen, 1990). As Cohen (1987) points out in his contractual analysis of marriage, lifelong spousal investments vary in important ways, so standardization might be a way to curb male opportunism. This, of course, could be less relevant to same-sex relationships, but our project does highlight a different motivation for standardization, namely, to reduce transaction costs when pecuniary assets are distributed by the government. We thank an anonymous reviewer for drawing our attention to this question.
The lack of recognition led to United States v. Windsor, a groundbreaking 2013 case that ruled in favor of a widow living in New York who had been denied the benefit of spousal deduction for federal estate taxes and left with a $363,000 estate tax bill because the federal government did not recognize her deceased same-sex partner as a spouse, even though the couple had been legally married in Canada.
Some scholars trace common law marriage back to the Catholic Church’s influence over Western law (Berman, 1985).
While other contractual options (e.g., living wills) could potentially fill some of these gaps, they are still unable to approximate the full extent of marital benefits (especially federal benefits). Attempts by states to pass domestic partnerships and civil unions highlight the fact that sufficient contractual remedies did not exist under the current system. While we do not explore this possibility in detail, our theory predicts that other countries with common law systems would follow similar pathways to same-sex marriage (as opposed to civil-law countries, which may involve better contractual options for same-sex couples).
https://www.caregiver.org/resource/legal-issues-lgbt-caregivers/
https://www.unmarried.org/parents-children/adoption/
Becker (1983) also shows that interest groups seeking a subsidy will be smaller than those taxed, or in common public choice parlance, benefits are concentrated and costs are dispersed.
A similar logic applies to same-sex marriage bans. While there was resistance to the rise of same-sex marriage in the form of state bans, eventually the interest group pressure for same-sex marriage at the federal level outweighed the interest group pressure against it at the state levels, leading to a federal protection of same-sex marriage. We thank an anonymous reviewer for raising this point.
Priest (1977) applied this logic to judicial cases, as may be the case with the repeated number of court cases over rights pertaining to marriage brought forth by same-sex couples against the states.
For example, the surviving spouse of a veteran does not have to pay property taxes in Tennessee (https://www.tn.gov/veteran/veteran-benefits/tn-state-benefits/homeowners/property-tax-relief-for-surviving-spouses.html), and Medicaid’s spousal income allowances vary by state (https://www.medicaidplanningassistance.org/mmmna-definition/).
Because these numbers are already adjusted for income, and since we include a measure of urban density as a variable, we forgo including median household income as a control variable across states to avoid multicolinearity.
Of course, this runs contrary to some conventional wisdom that simply views Clinton as the president who implemented “Don’t Ask, Don’t Tell” and signed the Defense of Marriage Act.
We include Table 5 in our Appendix which gives the dates and names of each of these cases, as well as the year of legalization of same-sex marriage (and/or comprehensive civil unions and domestic partnerships).
We thank an anonymous reviewer for making this point
https://www.opensecrets.org/federal-lobbying/industries/summary?cycle=2022&id=J7300
For a collection of records on the history of the United States Veterans Administration, see https://archives. lib.umn.edu/repositories/11/resources/598
Surviving widows of Civil War veterans were still receiving Civil War pensions as late as 1999 (https://www. ssa.gov/history/briefhistory3.html).
The United States has a riddled history of sexual minority immigration exclusions. The Immigration Act of 1917, for instance, restricted sexual minority immigration, or what they called those who exhibited “constitutional psychopathic inferiority” (Carro, 1989). Up until 1963, homosexuality was labeled as a disease in the Diagnostic and Statistical Manual of Mental Disorders (DSM) (Drescher, 2015), which is what allowed for many immigration restrictions on the basis of “psychopathy.” The Immigration Act of 1965 labeled sexual minorities as “sexual deviants” (Public Law 89-236), and up until 2010, individuals living with HIV/AIDS could not travel or emigrate to the United States (Winston and Beckwith, 2011). See Carro (1989) for a deeper history of the many laws against sexual minorities, especially with regard to their immigration status.
As Titshaw (2010) details, although states typically define what constitutes marriage, Congress has historically had the authority to override certain types of marriages. Specifically, marriage fraud, unconsummated proxy marriage, polygamy, and same-sex marriage (up until Windsor) were excluded.
Importantly, though, there were two rare exceptions: “Although same-sex relationships still are not recognized for the purpose of issuing most benefits under the INA, the USCIS [U.S. Citizenship and Immigration Services] and State Department now recognize non-marital life partnerships in two instances. First, if one of the partners has a visa to reside in the United States for temporary work or study, that person’s foreign partner may accompany him or her in B-2 visitor (tourist) status. Second, the State Department recently changed its regulations to allow it discretion in granting derivative status to the partners of U.S. diplomats, consular officers and some other foreign officials if the partnership is legally recognized in the sending country.” See Titshaw (2010) for further details.
We thank an anonymous reviewer for pointing us to this research.
https://www.taxpolicycenter.org/statistics/standard-deduction
https://taxfoundation.org/tax-cuts-and-jobs-act-marriage-penalty/
https://www.aarp.org/retirement/social-security/questions-answers/same-sex-couples-social-security.html.
As Badgett and Mallory (2014) note, there is a “Windsor” effect in which the number of same-sex marriages increased post-Windsor ruling. However, in New York, this effect is counteracted by the fact that New York had just legalized in 2011, so much of the pent-up demand had already been satisfied.
We thank any anonymous reviewer for making this point.
These countries are Andorra, Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, Colombia, Costa Rica, Cuba, Denmark, Ecuador, Finland, France, Germany, Iceland, Ireland, Luxembourg, Malta, Mexico, the Netherlands, New Zealand, Norway, Portugal, Slovenia, South Africa, Spain, Sweden, Switzerland, Taiwan, the United Kingdom, and Uruguay.
References
Abramowitz, J. (2016). Saying, “I don’t”: The effect of the Affordable Care Act young adult provision on marriage. Journal of Human Resources, 51(4), 933–960.
Aksoy, C. G., Carpenter, C. S., Hass, R. D., & Tran, K. D. (2020). Do laws shape attitudes? Evidence from same-sex relationship recognition policies in Europe. European Economic Review, 124, 1–18.
Allen, D. W. (1990). An inquiry into the state’s role in marriage. Journal of Economic Behavior & Organization, 13(2), 171–191.
Allen, D. W. (2005). An economic assessment of same-sex marriage laws. Harv. JL & Pub. Pol’y, 29, 949.
Allen, D., & Price, J. (2020). Stability rates of same-sex couples: With and without children. Marriage & Family Review, 56(1), 51–71.
Badgett, M. (2009). The economic value of marriage for same-sex couples. Drake l. Rev., 58, 1081.
Badgett, M. L., & Mallory, C. (2014). The Windsor effect on marriages by same-sex couples. UCLA: The Williams Institute.
Baunach, D. (2012). Changing same-sex marriage attitudes in America from 1988 through 2010. Public Opinion Quarterly, 76(2), 364–378.
Becker, G. S. (1973). A theory of marriage: Part I. Journal of Political Economy, 81, 813–846.
Becker, G. S. (1983). A theory of competition among pressure groups for political influence. The Quarterly Journal of Economics, 98(3), 371–400.
Becker, G. S. (1991). A treatise on the family: Enlarged edition. Harvard University Press.
Berman, H. J. (1985). Law and revolution. Harvard University Press.
Buchanan, J. M., & Tullock, G. (1962). The calculus of consent: Logical foundations of constitutional democracy. University of Michigan Press.
Carpenter, C. S. (2020). The direct effects of legal same-sex marriage in the united states: Evidence from Massachusetts. Demography, 57, 1787–1808.
Carpenter, C. S., Eppink, S. T., Gonzales, G., & McKay, T. (2021). Effects of access to legal same-sex marriage on marriage and health. Journal of Policy Analysis and Management, 40, 376–411.
Carro, J. L. (1989). From constitutional psychopathic inferiority to aids: What is in the future for homosexual aliens? Yale Law and Policy Review, 7(1), 201–228.
Chen, T. (2019). Health insurance coverage and marriage behavior: Is there evidence of marriage-lock? Technical report, University of Connecticut, Department of Economics.
Cheng, C., Crumbley, D. L., Enis, C., Yurko, A. J., & Yurko, J. P. (2021). Does the marriage tax differential influence same-sex couples’ marriage decisions? Journal of Marriage and Family, 83(1), 152–172.
Cohen, L. (1987). Marriage, divorce, and quasi rents; or, “I gave him the best years of my life.” The Journal of Legal Studies, 16(2), 267–303.
Delhommer, S. M., & Hamermesh, D. S. (2021). Same-sex couples and the gains to marriage: The importance of the legal environment. Journal of Policy Analysis and Management., 40, 1120.
Dillender, M. (2014). The death of marriage? The effects of same-sex partnership laws on risky sex. Demography, 51, 563–585.
Drescher, J. (2015). Out of DSM: Depathologizing homosexuality. Behavioral Science, 5(4), 565–575.
Drydakis, N. (2021). Sexual orientation discrimination in the labor market against gay men. Review of Economics of the Household, 20, 1027–1058.
Fernández, R., Parsa, S., and Viarengo, M. (2019). Coming out in America: Aids, politics, and cultural change. NBER working paper series, National Bureau of Economic Research.
Flores, A. R., & Barclay, S. (2016). Backlash, consensus, legitimacy, or polarization: The effect of same-sex marriage policy on mass attitudes. Political Research Quarterly, 69, 43–56.
Friedberg, L., & Isaac, E. (2022). Same-sex marriage recognition and taxes: New evidence about the impact of household taxation. Review of Economics and Statistics. https://doi.org/10.1162/rest_a_01176
Fryer, R. G., Jr. (2007). Guess who’s been coming to dinner? Trends in interracial marriage over the 20th century. Journal of Economic Perspectives., 21, 71–90.
Gates, G. J. and Brown, T. N. (2015). Marriage and same-sex couples after Obergefell. UCLA: The Williams Institute.
Girgis, S., George, R. P., and Anderson, R. T. (2011). What is marriage. Harv. JL & Pub. Pol’y, 34:245.
Goldstein, J. R., & Kenney, C. T. (2001). Marriage delayed or marriage forgone? New cohort forecasts of first marriage for us women. American Sociological Review, 66, 506–519.
Hafen, B. (1983). The constitutional status of marriage, kinship, and sexual privacy – balancing the individual interests. Michigan Law Review, 81, 467–484.
Haider-Markel, D. P. (2010). Out and running: Gay and lesbian candidates. Georgetown University Press.
Hall, L. K. (2014). Family and the Politics of moderation: private life, public goods, and the rebirth of social individualism. Baylor University Press.
Hampton, M., & Lenhart, O. (2022). The effect of the Affordable Care Act medicaid expansion on marriage. Economic Inquiry, 60(2), 568–591.
Hull, K. E. (2006). The cultural politics of love and law. Cambridge University Press.
Isaac, E. (2018). Suddenly married: Joint taxation and the labor supply of same-sex married couples after U.S. v. Windsor. Working Papers 1809.
Jace, C. E., & Makridis, C. A. (2021). Does marriage protect mental health? Evidence from the covid-19 pandemic. Social Science Quarterly., 6, 2499–2515.
Jones, J. M. (2016). Same-sex marriages up one year after Supreme Court verdict. Social and Policy Issues, Gallup
Lafortune, J., & Low, C. (2023). Collateralized marriage. American Economic Journal: Applied Economics, 1, 1. https://doi.org/10.3386/w27210
Leeson, P. T., & Pierson, J. (2017). Economic origins of the no-fault divorce revolution. European Journal of Law and Economics, 43, 419–439.
Lundberg, S., & Pollak, R. A. (1996). Bargaining and distribution in marriage. Journal of Economic Perspectives, 10(4), 139–158.
Mallory, C., & Sears, B. (2020). The economic impact of marriage equality five years after Obergefell. The Williams Institute: UCLA School of Law.
Martin, J. and Rodriguez, Z. (2022). The effect of same-sex marriage legalization on adoptions and family formation in the US Available at SSRN: https: //papers. ssrn. com/sol3/ papers. cfm? abstract_ id= 4307175.
Matouschek, N., & Rasul, I. (2008). The economics of the marriage contract: Theories and evidence. The Journal of Law and Economics, 51(1), 59–110.
Meezan, W., & Rauch, J. (2005). Gay marriage, same-sex parenting, and America’s children. Marriage and Child Wellbeing, 15(2), 97–115.
Mercier, A. (2008). On the nature of marriage: Somerville on same-sex marriage. The Monist, 91(3/4), 407–421.
Mitchell, W. C., & Munger, M. C. (1991). Economic models of interest groups: An introductory survey. American Journal of Political Science, 35(2), 512–546.
Ofosu, E. K., Chambers, M. K., Chen, J. M., & Hehman, E. (2019). Same-sex marriage legalization associated with reduced implicit and explicit antigay bias. Proceedings of the National Academy of Sciences, 116, 8846–8851.
Olson, M. (1965). The logic of collective action: Public goods and the theory of groups. Yale University Press.
Peters, H. E., Simon, K., & Taber, J. R. (2014). Marital disruption and health insurance. Demography, 51(4), 1397–1421.
Piano, C. E. (2022). Autocratic family policy. Constitutional Political Economy, 33(2), 233–253.
Posner, R. A. (1997). Should there be homosexual marriage? And if so, who should decide? Michigan Law Review., 95, 1578–1587.
Potter, M. H., & Font, S. A. (2021). State contexts and foster care adoption rates. Children and Youth Services Review, 126, 106049.
Priest, G. L. (1977). The common law process and the selection of efficient rules. The Journal of Legal Studies, 6(1), 65–82.
Redpath, C. (2022). Spousal visa policy and mixed-citizenship couples: Evidence from the end of the defense of marriage act. Working Paper.
Regier, J. and Pardue, M. (2007). The effects of marriage on health. US Department of Health and Human Services.
Reynolds, A. (2013). Representation and rights: The impact of LGBT legislators in comparative perspective. American Political Science Review, 107, 259–274.
Ribar, D. C. (2004). What do social scientists know about the benefits of marriage? A review of quantitative methodologies. Institute for the Studies of Labor, 998, 1–80.
Rimmerman, C. A., & Wilcox, C. (2007). The politics of same-sex marriage. University of Chicago Press.
Rosenfeld, M. J. (2017). Moving a mountain: The extraordinary trajectory of same-sex marriage approval in the United States. Socius, 3, 2378023117727658.
Sansone, D. (2019). Pink work: Same-sex marriage, employment and discrimination. Journal of Public Economics, 180, 1–20.
Schulz, J. F., Bahrami-Rad, D., Beauchamp, J. P., & Henrich, J. (2019). The church, intensive kinship, and global psychological variation. Science, 366(6466), eaau5141.
Scott, J. C. (2008). Seeing like a state. Yale University Press.
Severino, R. (2006). Or for poorer—how same-sex marriage threatens religious liberty. Harv. JL & Pub. Pol’y, 30, 939.
Shughart, W. F., & Tollison, R. D. (1989). On the growth of government and the political economy of legislation. The Journal of Law and Economics, 19, 111–127.
Smith, R. A. and Haider-Markel, D. (2002). Gay and Lesbian Americans and Political Participa-tion. ABC-CLIO.
Stansel, D., Torra, J., & McMahon, F. (2014). Economic freedom of North America 2014. Fraser Institute.
Stevenson, B., & Wolfers, J. (2007). Marriage and divorce: Changes and their driving forces. Journal of Economic Perspectives, 21(2), 27–52.
Stone, L. (2020). Pro-natal policies work, but they come with a hefty price tag. Institute for Family Studies.
Surrey, S. S. (1947). Federal taxation of the family–the Revenue Act of 1948. Harvard Law Review, 61, 1097.
Tasker, F. (2010). Same-sex parenting and child development: Reviewing the contribution of parental gender. Journal of Marriage and Family, 72(1), 35–40.
Thompson, J. (2000). Veterans benefits administration annual benefits report for fiscal year 2000. Department of Veterans Affairs
Titshaw, S. C. (2010). The meaning of marriage: Immigration rules and their implications for same-sex spouses in a world without DOMA. William Mary Journal of Race, Gender, and Social Justice, 16(3), 537–611.
Wald, M. S. (2001). Same-sex couples marriage: A family policy perspective. Virginia Journal of Social Policy & the Law, 9, 291.
West, R. (1998). Universalism, liberal theory, and the problem of gay marriage. Florida State University Law Review, 25, 719–730.
Winston, S. E., & Beckwith, C. G. (2011). The impact of removing the immigration ban on HIV-infected persons. AIDS Patient Care and STDS, 25(12), 709–711.
Zimmer, D. M. (2007). Asymmetric effects of marital separation on health insurance among men and women. Contemporary Economic Policy, 25(1), 92–106.
Acknowledgements
We would like to thank participants of the 2021 APEE meetings, especially Ennio Piano and Bryan Cutsinger, for their helpful comments on an earlier draft. We are also grateful to editor Peter Leeson for guiding us through the revision process and to four anonymous reviewers for their constructive criticism.
Author information
Authors and Affiliations
Corresponding author
Additional information
Publisher's Note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
The original online version of this article was revised due to Rachael Behr snf Kacey Reeves West authors affiliation corrections.
Rights and permissions
Springer Nature or its licensor (e.g. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law.
About this article
Cite this article
Piano, C.E., Behr, R. & West, K.R. The supply and demand of marital contracts: the case of same-sex marriage. Public Choice 198, 237–268 (2024). https://doi.org/10.1007/s11127-023-01076-7
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11127-023-01076-7