Economists in Love: Allen Parkman

Here’s what keeps us up at night: wailing children, stress about work, concerns about the book. Here’s what keeps Allen Parkman, economist and attorney up at night: How to overcome the perverse incentives created by unilateral, no-fault divorce. Parkman, a professor at the University of New Mexico, likes applying economics to marriage. He even wrote a book about it: Smart Marriage: Using Your Head as Well as Your Heart to Find Wedded Bliss.

1. What’s a ‘smart marriage’ and how does one achieve one?

A “smart marriage” is one that both spouses agree is a success. As a minimum, it is better than any other arrangement that they might consider. Hopefully, it is much better than that. Like other aspects of life, it requires more concerted thought than in the past. However, thinking is a costly process so people are inclined to want to avoid it. So a “smart marriage” requires much more thought than marriages in the past, about the person that they marry, the roles that they will assume during marriage, whether to have children and when, etc.

2. You say treat your relationship like a business. Isn’t that horribly unromantic?

As noted above, people’s top priority is a successful marriage. Divorce statistics indicate that accomplishing that goal is not easy. People get married because they are in love, but they stay married because they conclude that theirs is a better arrangement than any other that they might consider. Therefore, the key to a successful marriage is for neither spouse to conclude that some other arrangement is preferred to this marriage. Great sex helps, but other aspects of the arrangement are also important. A profitable business converts inputs into outputs creating value in the process. Couples that find a way to use their collective resources to create substantial value probably find their marriage is a success, while others are less successful.

3. Has your work as an economist made you a better husband? Would your wife agree? (Feel free to let her chime in.)

Some of the attributes that attracted me to economics have probably been helpful in our married life. Fundamental to me and suggested by economics is the importance of living within our “budget constraint.” In our household, a “credit card” has only been a “transaction card.” Economics was helpful in the recent stock market downturn. Not having anticipated it, we had to live through the decline in the value of our stocks. As they declined, my wife started to strongly suggest that we liquidate. Concluding that long term factors did not justify the decline, we did not sell and have subsequently recovered to and passed our prior level. My wife has been kind enough to compliment me on my “wisdom.”

4. Why is it we treat our work colleagues with more respect than our spouses sometimes? Is there an economic solution to this?

I have much more respect for my wife than for my colleagues–for two reasons. First, I chose her (and she was kind enough to choose me) and I would not have chosen someone who was not worthy of my respect. I did not necessarily choose my colleagues. Second, my wife and I are involved in a communal endeavor, so I know that criticism is less productive than working toward a common solution. Even with colleagues I find constructive solutions to be more productive than criticism. However, since my interactions with my colleagues are more limited, I might be inclined to criticize a colleague when it is appropriate—in an evaluation, for example.

5. Couples fight endlessly about housework. Have you and your wife found any economic solutions?

Yes. Comparative advantage has been our subtle guide. Both of us have worked throughout the marriage, so comparative advantage eventually suggested that we turn over the least attractive aspects of our housework to those who are more competent—and may not have the employment opportunities that we have. Therefore, we have hired others to do the periodic jobs of basic house cleaning and yard maintenance. As to many other tasks, an informal process of comparative advantage has developed. Amy usually cooks and I usually clean up. She does the bills and I do the taxes.

There has also been an income effect. Early in the marriage, we did most of our home maintenance projects such as painting and building fences. Now we are more likely to hire someone to do the things for which we are less competent or prefer to avoid.

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