Shoshana Grossbard, Lucia Mangiavacchi, William Nilsson, Luca Piccoli

We analyze the association between spouses' incomes using a rank-rank specification that takes non-linearities along both spouses’ income distribution into account. We also document that the relationships between income and labor force participation and income and couple formation are non-linear. Using simulations, we then analyze how changes in spouses’ rank-dependence structure, labor force participation and couple formation contribute to the upsurge of income inequality in the U.S between 1973 and 2013. We find that an increased tendency towards positive sorting contributed substantially to the rise in inequality among dual-earner couples, but contributed little to overall inequality across households. When considering all households, the factor accounting most for the increased inequality during this period is an increased tendency for individual men and women to remain single. 

Publication Type
Working Paper
File Description
First version, December 10, 2019
JEL Codes
J12: Marriage; Marital Dissolution; Family Structure; Domestic Abuse
J22: Time Allocation and Labor Supply
D31: Personal Income, Wealth, and Their Distributions
income inequality
assortative mating
female labor supply
rank dependence