When It Comes to Income Pooling, Marriage Still Matters

My niece, Jaime, is 27 and has been married for almost four years. Are she and her partner more likely to pool, or combine, their incomes than an otherwise similar couple who has been cohabiting for the same amount of time?

If your hunch is to say “yes,” then your prediction matches the social reality. I told you almost nothing about Jaime—not that she’s married to a Filipino man, nor that their first child is coming later this month, nor that she’s a college graduate whose architectural specialty is designing health care facilities. But none of those biographical details matter as much as her marital status when it comes to predicting her income pooling behavior.

Social research will never be able to tell us what choice individuals will make, but it excels in describing the behavior of groups of individuals. Such research has persistently shown that as a group, married people are more likely to pool their income than cohabitants.

A new study looked at why. Kasey Eickmeyer, Wendy Manning, Monica Longmore, and Peggy Giordano explored how much of the married-cohabiting income pooling gap among young adults is explained by one of the most obvious differences between the two groups: married people are more committed to each other. Focus groups from nine European countries and Australia all concurred that marriage represents a higher level of commitment than cohabitation. Driven by this social reality, and also keenly aware of other persistent differences (e.g., married people are, on average, older and have more income), Eickmeyer and her colleagues performed a statistical exercise that allowed them to predict the income pooling of marrieds if they had the same characteristics as cohabitants. When income pooling was estimated among marrieds using their own (actual) characteristics, 83% completely pooled; when marrieds were artificially assigned cohabitors’ characteristics, 80% still completely pooled.

On the one hand, this statistical exercise confirmed that marrieds pool their income more because they have certain characteristics like higher levels of commitment that contribute to income pooling. What is remarkable, however, is how little of the income pooling gap is explained: cohabitants completely pooled 37% of the time. If we think of the prevalence of married income pooling as being inflated by marrieds having characteristics favorable to pooling, the inflation factor of 3 percentage points is paltry compared to the magnitude of the remaining gap, i.e., 43 percentage points. 

The authors characterize the persistent pooling gap as “somewhat not surprising, given the rich financial benefits, and legal protections afforded married spouses’ finances in the case of dissolution, and the distinct lack of recourse and financial benefits for cohabiting couples.” They go on to explain how even the structure of a joint tax return facilitates the idea of “our” finances rather than “mine” and “yours.” The possibility that structure matters in this way is buttressed by international comparative research showing that there is a smaller marriage-cohabitation income pooling gap in countries where everyone is taxed as an individual.

Nonetheless, the central finding in their work—that married people pool their incomes more—gets somewhat obscured by their discussion. This is the third scholarly article on the married-cohabiting income gap that I have highlighted in this space (see here from 2019 and here from 2021), and the Reader’s Digest version of all three articles runs something like this: “We had good reason to believe that X could account for the married-cohabiting income pooling gap; we accounted for X, and marriage is still different than cohabitation when it comes to income pooling.” 

What I find somewhat unsurprising is the fact that marriage is (still) different than cohabitation. Most people would have guessed that Jaime and her husband pool their income just from knowing that they are married. Here is the way that Eickmeyer and her colleagues describe a vignette study of income pooling attitudes:

Pepin (2019) found that most adults believe that married couples, whether or not they shared children and irrespective of relationship duration, should pool their income into a shared account, compared to partial pooling or keeping separate accounts. Yet, respondents preferred partial pooling or maintaining separate accounts for cohabiting couples, regardless of parental status or relationship duration.

This evidence shows that we hold different social norms for income management according to marital status. Thus, differences in behavior between married people and cohabitants are not fully accounted for by individual circumstances (e.g., material poverty, a shared child) or context (e.g., the tax code, women’s labor force participation rates, divorce rates). Instead, income pooling behavior is persistently shaped by marital status. Perhaps this has something to do with our social understanding of marriage as a comprehensive union.

Laurie DeRose is a senior fellow at the Institute for Family Studies, Assistant Professor of Sociology at the Catholic University of America, and Director of Research for the World Family Map Project.