Assortative Mating and Earnings Inequality in France

Abstract

This paper analyzes economic assortative mating and its contribution to inequality in France. We first provide descriptive evidence on the statistical association in several socio-economic attributes of partners among French couples (annual earnings, potential earnings, education, occupation). Second, we assess the contribution of assortative mating to earnings inequality between couples. Contrary to previous estimates, we account for possible biases in the estimation of assortative mating arising from sample-selection into the labor force. We also provide a new method for assessing the contribution of assortative mating to inequality in couple's potential earnings. Our results indicate a strong degree of assortative mating in France. The correlation coefficient for education is above 0.6. The correlation in earnings is lower but sizable: around 0.17 for annual earnings, when including zeroes; around 0.35 for full-time equivalent earnings and up to 0.49 when using multi-year average earnings. We show that assortative mating tends to increase inequality among couples, compared to random mating. For annual earnings, the effect is non-negligible and accounts for 3 to 9% of measured inequality. The effect of assortative mating on household potential earnings is much larger and amounts to 10 to 20% for observed inequality.