How Does Matching Uncertainty Affect Marital Surplus? Theory and Evidence from China

2022-03-01 Working Paper Series
HKUST CEP Working Paper No.2022-02

Photo by Arisa Chattasa on Unsplash

Information quality affects matching and marital outcomes. We show in a simple two-dimensional matching model that a noisier cue for one trait leads to a shift in sorting tradeoff toward the other, lowers average welfare but the impact is asymmetric. To test the predictions, we explore the repeal of mandatory premarital health examinations in China. The repeal, increasing health cue noise, is found to have reduced postmarital subjective well-being mainly through a reduction in child health associated with decreased sorting by health. The deterioration was particularly strong for women and the poor, suggesting entrenched inequality by gender and wealth.

Li Han
Associate Professor, Division of Social Science
Li Han is associate professor of economics in the Division of Social Science at the Hong Kong…
Xinzheng Shi
Tsinghua University
Ming-ang Zhang
Central University of Finance and Economics

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