COLUMN - The lawyer marries not the secretary, but the chief physician: new insights into the economics of partner selection

May is known to mark the beginning of the wedding season. Last year, over 36,000 couples in Switzerland exchanged vows. This year, many more couples are likely to walk down the aisle. Weddings are a good opportunity for economic considerations. Because the choice of partner has not only personal but also macroeconomic consequences.

Tax data clearly shows that when it comes to choosing a partner, the principle "birds of a feather flock together" applies. This is especially true at the margins of the income distribution. Rich people marry rich people: A top earner is highly likely to marry a top earner – 15 times more likely than would be the case by chance. A lawyer marries not a secretary, but a chief physician – and together they share two top salaries in the marital pot.

This has a noticeable impact on income inequality. In a study, I, together with Christoph Schaltegger and Michele Salvi, used tax data to examine couples one year before their marriage and showed that partner choice has strong distributional effects.

If marriages were determined by lottery, income inequality in Switzerland would be significantly lower. The Gini index would be eleven percent lower. In other words, Swiss men and women are accepting greater inequality through their choice of partner.

Since selective partner choice is particularly pronounced among high earners, this is also where the strongest redistributive effect occurs. To assess its significance, we examined the extent to which the progressive tax system cushions this inequality. Due to progression, high-earning couples in particular contribute to the redistribution between rich and poor. In other words: While selective partner choice increases inequality, the progressive income tax system counteracts it. The comparison, however, reveals something surprising: For those with higher incomes – up to the top five percent – ​​partner choice increases inequality more than tax progression can offset. Only for the very richest households does the tax system succeed in completely offsetting this effect. This means that those who live with a partner who earns a similar amount of money weaken part of the tax redistribution.

Such distributional issues are also relevant for the future design of the tax system. For years, Switzerland has been debating the abolition of the marriage penalty and the introduction of individual taxation – most recently this week in the National Council. From an economic perspective, there are good reasons for a system change, such as stronger work incentives for second earners.

From a distributional perspective, however, the situation is less clear: those couples in which both partners have similarly high incomes would benefit most from the abolition of the marriage penalty – i.e. those who contribute to inequality through their selective choice of partner.

Furthermore, the literature shows that a system change from joint taxation to individual taxation could further increase selective partner choice and thus further exacerbate inequality.

According to the Italian economist Giacomo Corneo, a change from joint taxation to individual taxation may even affect the quality of marriages: unions between different income groups, which could be particularly emotionally fulfilling, would occur less frequently - because marriage between people with the same income would be even more worthwhile due to the abolition of the marriage penalty.

One thing is clear: every tax burdens economic performance and reduces incentives to work. And it is equally clear: before income can be distributed, it must be earned. This results in a fundamental conflict between efficiency and distribution – and the abolition of the marriage penalty is no exception. Therefore, there is fundamentally strong support for the introduction of individual taxation.

At the same time, the existing regulation is remarkably effective from a distributional perspective. It primarily burdens so-called "power couples," who contribute particularly heavily to tax revenue—which demonstrates that there are no simple solutions in times of strained public finances.