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Supply, Demand and Internet Dating

Aug 3, 2011 • Behavioral Economics, Demand, Supply, and Markets, Households, Thinking Economically • 243 Views    No Comments

What if, “you’re an 8 constantly chasing after 10s and constantly being chased by 6s?” Described in the Financial Times, the developers of Match.com’s algorithm, codenamed Synapse, have an answer.

“It’s just supply and demand.”

On the supply side, we can find individuals with certain characteristics–maybe age range, hair color, body type, religion–who are available for a relationship. Similarly, on the demand side of the market are men and women who, seeking a mate, will be more likely to respond when the supply side has the characteristics they seek.

Equilibrium? Where the attributes from the supply side are equal to those on the demand side. And therein lies the problem for our person who is an “8.” He or she will be a part of clearing the market when satisfied with another “8.”

The Economic Lesson

Nobel prize winning economist Gary Becker tells us that marriage is about a lot more than love. Instead, we can best understand marriage by looking at utility functions and marriage markets.

People marry because they expect to, “raise their utility level above what it would be were they to remain single.” (The Essence of Becker, p. 273) Looking for their best mate, they compete in marriage markets that have demand and supply curves. To see Dr. Becker’s descriptive and quantitative explanations, you might want to look at The Essence of Becker, pp. 273-328.

An Economic Question: What marginal utility might marriage provide to newlyweds?

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