Answer to Question #286953 in Macroeconomics for Mbk

Question

 Suppose a Mrs. Chakay marries her butler, Ato Tachakay. After they are married, her husband continues to wait on her as before, and she continues to support him as before (but as a husband rather than as an employee). How does the marriage affect GDP? How should it affect GDP? Justify your debate.

Answer 1

Researchers Bradford Wilcox, Joseph Price and Robert Lerman found that high marriage rates, they believe, correlate with increased per capita GDP, increased economic mobility, low child poverty, and higher average family incomes. Since the family forces them to spend and work, this increases the GDP.

But in this case, everything is not so simple. Before the wedding, the butler was paid a salary that was included in the GDP, but after the wedding, the wife began to support her husband with private transfer payments that were not counted in the GDP. Therefore, GDP will fall after marriage registration