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Love or Money? The economics of online dating

Published 11/02/2016, 09:07 AM
Updated 11/02/2016, 09:10 AM
© Reuters. A couple tries to hold on to an umbrella flipped inside out at a sea front, in Mumbai

By Chris Taylor

NEW YORK (Reuters) - When it comes to love, money has nothing to do with it. Right?

Not so fast.

After all, they don't call it a "meet market" for nothing. The dating world is, in fact, its own market, with complex economic judgments taking place all the time.

That is according to Dr. Marina Adshade, an economics professor at the University of British Columbia and author of the book "Dollars & Sex," which examines the relationship between money and love.

"Dating markets don't have currency, so they depend on other mechanisms to operate, much like a barter system," Adshade said. "It all depends on what you are bringing to the table. Some of those qualities might be age or attractiveness - and some are financial."

Indeed, just go on popular dating sites such as Match.com, and one of the criteria for winnowing down potential matches is annual income. You can look for someone who makes $50,000 a year, or $75,000, or $100,000.

So, does that matter? Well, in one study published in the Journal of Economic Behavior & Organization, which crunched data from a popular Chinese online-dating website, male profiles with the highest income levels got 10 times more visits than the lowest.

Another study, co-authored by famed behavioral economist Dan Ariely, uncovered similar online-dating preferences.

"Men and women prefer a high-income partners over low-income partners," the authors wrote in the journal Quantitative Marketing and Economics. "This income preference is more pronounced for women."

The takeaway: As much as we like to think we are beyond the days of Jane Austen, when suitors were evaluated largely based on how much money they brought in - the famous Mr. Darcy in "Pride & Prejudice" was worth "Five thousand a year!" - money can be critical in our romantic lives.

"Someone's income will almost always factor into the equation," says Douglas Kobak, a financial planner in Conshohocken, Pennsylvania.

"When you are becoming serious, you need to consider what your partner is bringing to the table besides love and a good time. The question becomes one about the potential to earn the income needed to build wealth and live a lifestyle you want."

ECONOMIC JUDGMENTS

Just think about the numerous economic judgments we are making while dating online. First off, we are essentially estimating our own value (which may or may not be accurate), Adshade notes. At the same time we are estimating others' value, and whether they are likely to respond - or whether they are "out of our league."

Then we are weighing interested suitors against the "opportunity costs" that there may be other, 'better' options still out there. And we make these judgments against the backdrop that we are all, sadly, depreciating assets. Wait too long for an ideal person, and you could miss out on quality matches, who will eventually be snapped up themselves.

There are also competing economic theories at work. Are you looking for someone relatively similar in qualities like income and education ("market theory")? Or are you looking for someone sufficiently different from yourself, that you both gain from the union ("economic trade theory")?

One note to remember: Annual income is just one financial data point, and probably not even the most important one. In terms of long-term economic security, it is better to partner with someone who makes $50,000 annually but lives below their means, than someone who makes $100,000 a year but spends wildly and racks up debt.

"Money itself is not nearly as important as are money habits," says Robert Braglia, a financial planner in New York.

Adshade's key advice for would-be romantics: Broaden the criteria you are looking for in a mate. If you are solely looking for a man who is over 6'2" and makes six figures annually, you have instantly gone from a "thick" market - one with literally millions of people - to a "thin" one, with few remaining options. Indeed, the tall, rich guy with a full head of hair is probably off the market already, she says.

Instead, devote yourself to a more "exhaustive" search that includes a wider variety of income levels, she advises. It will take more time to sift through that broader pool, but that is better than "artificially reducing the size of your search sample," she says. "That is the biggest mistake."

© Reuters. A couple tries to hold on to an umbrella flipped inside out at a sea front, in Mumbai

The writer is a Reuters contributor. The opinions expressed are his own.

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