Good economics: Internet dating services or speed dating events reduce the time spent searching for a partner.
How often do you think about love? What about the dating scene?
One of our federal politicians has been ruminating on both lately and he’s come up with rules to help you find one in the other.
Shadow Assistant Treasurer Andrew Leigh, who is an economist, has published a new book called The Economics of Just About Everything.
Dr Leigh reckons the economics of dating follow three simple rules:
1. There is no perfect match for you, but some matches are definitely better than others.
2. You won’t know how well suited you are to someone until you get to know them.
3. Time is scarce, so a decision based on limited information is probably better than no decision at all.
According to Leigh, the problem with the dating scene is that you don’t have enough information about the people in it, and you don’t have enough time to find out all the information you need to make a good decision.
That leaves you in a pickle, which economists call an “optimal-stopping problem”.
The idea is simple: you must choose a time to stop looking (for someone) in order to get the best outcome (a match you’re happy with).
As Leigh shows, the problem exists everywhere: “If you’re trying to sell your house, at what point should you accept an offer that’s lower than your asking price? If you’re looking for a job, which job should you settle for?”
So when’s the best time to stop looking for Mr or Mrs Right and settle down with someone in the dating scene?
Well, since you don’t have enough time or enough information, Leigh reckons the best way to help yourself is to use internet dating services or go to speed dating events because they reduce the time spent searching.
They’ll expose you to more people in less time so the chance of meeting someone is higher.
Then, if you’re lucky enough to find someone you like, the economics of relationships come into play.
And Leigh says empirical evidence suggests love matches are on the rise.
Considering heterosexual relationships, one of the reasons love matches seem to be increasing is because the traditional breadwinner/homemaker model is breaking down.
That model was built on people who specialise in different things – homemaking and breadwinning – so they are likelier to be different kinds of people, with different interests.
But these days, with more women working and more men helping around the home, today’s heterosexual couples are more likely to be looking for someone who can do similar things to them.
So as Leigh puts it, “More than ever before, young people have the freedom to look for a soul mate.”
So if you use internet dating sites, coupled with the modern freedom to look for someone with similar skills and interests, your chances of finding someone special will be higher.
With that, he leaves us with a little bit of advice:
“There’s only one way to use these economic insights into romance, and that’s tactfully. You may be solving an optimal-stopping problem, but divulging this insight on your first date may mean that it’s also your last.”