To refresh your memory, I posted a video from The Onion about how the nation’s girlfriends were calling for more moving in together as a way to cut costs during the recession. Here’s the video again (click the link above for the original commentary):
Nation’s Girlfriends Unveil New Economic Plan: ‘Let’s Move In Together’
I made a claim in the original post that there were significant economies of scale to be capitalized on by moving in together, but I merely gave some vague anecdotal evidence as backup. Luckily Tyler Cowen over at Marginal Revolution can do me one better:
Bruce Bartlett sends me a link to this interesting paper:
How large are the economies of scale of living together? And how do partners share their resources? The first question is usually answered by equivalence scales. Traditional estimation and application of equivalence scales assumes equal sharing of income within the household. This paper uses data on financial satisfaction to simultaneously estimate the sharing rule and the economy of scale parameter in a collective household model. The estimates indicate substantial scale economies of living together, especially for couples who have lived together for some time. On average, wives receive almost 50% of household resources, but there is heterogeneity with respect to the wives’ contribution to household income and the duration of the relationship.
That was a lot of words. Let me point you to the most relevant ones: substantial scale economies of living together. There you go, ladies and gentlemen- hard proof. Now to go bring this newfound evidence to my (hypothetical) boyfriend…wait, why is he running away? *sigh* Teaching economics is so hard sometimes…