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Economics of dating websites

And so I started online dating, and immediately, as an economist, I saw this was a market like so many others.The parallels between the dating market and the labor market are so overwhelming, I couldn’t help but notice that there was so much economics going on in the process.Well, from an economist’s perspective, I was ignoring what we call “statistical discrimination.” And so, people see that you’re separated, and they assume a lot more than just that.I just thought, “I’m separated, I’m happy, I’m ready to look for a new relationship,” but a lot of people assume if you’re separated, you’re either not really — that you may go back to your former spouse — or that you’re an emotional wreck, that you’re just getting over the breakup of your marriage and so forth.If employers go out and look for employees, they have to spend time and money looking for the right person, and employees have to print their resume, go to interviews and so forth.You don’t just automatically make the match you’re looking for.Paul Solman: Just listening to you right now, I was wondering if that was an example of Akerlof’s “market for lemons” problem. Statistical discrimination is always closely related to adverse selection, or the so-called Akerlof’s lemons problem.

And it was only when we went to this marketplace together, which in our case was JDate, that we finally got to know each other. And I suggested that I was newly single and ready to look for another relationship.Paul Oyer: There’s a branch of labor economics known as “search theory.” And it’s a very important set of ideas that goes beyond the labor market and beyond the dating market, but it applies, I think, more perfectly there than anywhere else.And it just says, look, there are frictions in finding a match.Editor’s Note: With Valentine’s Day right around the corner, we decided to revisit a piece Making Sen$e did on the world of online dating. Making Sen$e airs every Thursday on the PBS News Hour.Last year, economics correspondent Paul Solman and producer Lee Koromvokis spoke with labor economist Paul Oyer, author of the book “Everything I Ever Needed to Know about Economics I Learned from Online Dating.” It turns out, the dating pool isn’t that different from any other market, and a number of economic principles can readily be applied to online dating. — Kristen Doerer, Making Sen$e Paul Oyer: So I found myself back in the dating market in the fall of 2010, and since I’d last been on the market, I’d become an economist, and online dating had arisen.

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