I seem to recall long ago reading about a survey that found that something like 96% of economists believed that free trade produced net benefits for the country as a whole. I remember thinking to myself that the other 4% of economists must be paid off by labor unions. How else to account for how out-of-step they were?
The effects of free trade, however, are not so simple as depicted in economists’ models. The models correctly identify some powerful mechanisms through which trade increases national productivity and wealth. What the models don’t consider, however, are the sociological effects of trade. International trade can have far reaching effects on the most intimate and important social institutions–marriage and the family.
In a recent working paper published by the National Bureau of Economic Research, economists David Autor, David Dorn, and Gordon Hanson go where economists have rarely gone before by studying the effect of trade on marriage and the family. They found specifically that the outsourcing and automation of manufacturing jobs contributed to the following social phenomena:
- A decline in marriage rates and an increase in the age at first marriage
- An increase in the rate of illegitimacy
- A rise in the proportion of female-headed households
- A rise in self-destructive behavior by males such as illegal drug use
The way globalization contributes to these phenomena is by lowering the economic status of males relative to females. The loss of economic opportunity is greater for males than for females because imports and outsourcing have their largest impact on manufacturing, where men predominate. In contrast, the fields where women predominate such as education, healthcare, human resources, and other services do not compete as directly with foreign workers and imports.
Lowering the economic status of males relative to females makes males less marriageable. In marriage, pretty much the only value a man can bring to the table is as an economic provider. Taking away a man’s advantage in providing economic resources leaves him without leverage in the marriage market.
Women are almost universally extremely averse to marrying down in terms of socioeconomic status. Men, in contrast, have no problem marrying a woman who is of lower economic status. This key difference between the sexes means that any change that lowers men’s status relative to women’s will reduce the number of men whom women consider to be marriageable.
Note that this argument does not rely on an absolute worsening of men’s economic opportunities. The key is the economic status of men relative to women. For instance, let’s say a working-class woman who earns $11 per hour views a male who earns $15 as marriageable. If the man’s wage increases to $16 but the woman goes all the way up to $19, she might no longer view him as marriageable, since women as a rule do not marry down. The man became less marriageable even though his wage went up because the woman’s wage went up by more. Any such change that raises the economic status of women relative to men will lower the marriage rate and the number of stable marriages.
Of course, there exist many examples of stable marriages where the woman earns more than the man. But these are exceptions rather than the rule. Studies show that of all the factors that can contribute to divorce, the one that has the most predictive power is the man earning less than the woman.
The other day I was in a store and saw a nice Black&Decker toaster-oven on sale for just $15. The toaster-oven, of course, was manufactured in some low-wage Asian country. If the toaster-oven were manufactured by unionized labor in the United States it might cost several times as much. As consumers, lower prices for imported goods benefit all of us. This benefit is the reason why economists generally support free trade. Economists can put a price on that cheap toaster-oven.
But what price on children no longer being raised in stable, two-parent families? That’s a price to which economists need to give more consideration.