The Economics of Dating

So I was at the bar with a couple of friends this weekend and had a rather amusing discussion. And by interesting I mean filled with machismo and vulgarity (you have been warned). Also, if you are a lady reading this, I think it's worth reading all the way through it to see the big picture (this actually advocates that men should be spending a lot of money on women). Look, this is meant to be for entertainment. It's also known to be VERY politically incorrect, but try to view this as a way of trying to measure things from an economic angle. It's hard to put a price on some things, so I use the only proxies for prices possible. No it's not tasteful, it's Wall Street.

The discussion at hand was how much a man spends on a girlfriend (or a prospective girlfriend or a prospective one-night stand) over time. What's a fair way to gauge how much a guy "should" spend on a girl? Well, here's how I think an economist would look at it:

What are the positive things you get out of it? Well, men obviously value sex. There's something about emotional support (although no girlfriend of mine has ever really been much emotional support. . . kidding. . .sorta. . .). Finally, there is the companionship (who really wants to go see a movie alone?). Let's value each of these.

First off, the sex. Market price for sex can be found on craigslist. I assume a "full service" massage is sex. If I'm wrong, please let me know (but don't let me know why you know) . I'm seeing it at about $200/hour. That sounds reasonable. Let's say sex goes at about $200/hr.

Second, the emotional support. Psychiatrists can give you all the emotional support you need for $130/hour (I actually called a therapist to ask for his fee just now, that was awkward).

Last, the companionship I'm actually going to mark-to-market as free. While it does have a dollar value, you can usually find some sort of companion for your movies, dinners, etc unless you're really a loser.

So if you have a full fledged girlfriend with whom you have sex for, say, four hours a week and divulge your emotional distress for two hours a week, you should be willing to pay $1060 per week. Wow, that's a lot. If we price it for a one night stand, we can just price the sex at $200/hr. Let's say it's a short one night stand, and a man should be willing to drop at least $200 fair value on drinks or whatever date expenditures.

The girl we were with protested that the sex was being priced at prostitution levels. Well, that's just dumb. I'm sitting here advocating that men ought to be willing to spend some $1060/week on a girl (that's a LOT higher than average wages in the US), and this girl is telling me that she finds that offensive. I bet you anything she doesn't complain when her boyfriend buys her gifts, dinner and drinks. In any case, the prostitution charges being offensive thing is a weak argument (she later went and slept with my friend that night).

The best argument, in my opinion, is that women get a lot out of it too. Well, an attractive woman has no trouble getting sex (hell, an unattractive woman has no trouble getting sex. . .). That' s for certain. So even if there is a market for male prostitution, it's a redundant market. Let's look at the therapy part. First off, there are a lot of men who are willing to be personal therapists for free (or for the enjoyment of being seen with an attractive woman, or for the glimmer of hope that the woman may some day actually become his girlfriend). So I'd argue that the mark-to-market of therapy for a woman is relatively low as well.

For argument's sake, let's let the woman's therapy be the same price--$130/hr. Now I'm going to argue for gender equality, I'm all for that. Well, even if we go for gender equality, let's face it, women require more emotional support than men. If you disagrees, please feel free to comment (rationally). So let's try to make for gender equality. That means the amount per week spent by men at fair value ($1060) should be equal to the fair value of what the men bring to the "relationship." So if that's to be monetized as therapy, we can price it at 8.15 hours. So a relationship with four hours of sex and two hours of the man whining per week should also have eight hours of the woman whining per week. Does that sound reasonable?

Now I've been pricing off of an attractive women. Of course an attractive woman is going to be able to more readily get free sex and therapy from men, so they can either whine more or demand more money be spent on them. In addition attractive women would be able to charge more if they were to prostitute themselves (hypothetical, please), again this means she can whine more or demand more money. So it is not surprising if attractive women cost more to date or just happen to be higher maintenance emotionally.

If we assume an unattractive woman, then the price moves the other way. She can not demand as much in dating costs and she can not be as high maintenance emotionally.

Now I haven't taken into account what happens when you have an ugly guy. I'm not sure if prostitutes or therapists can charge more for services with an ugly guy, but maybe they can. The prostitutes aren't technically working legally anyway, so I guess they wouldn't be effected by discrimination laws, at the very least.

Clearly, this is not how actual relationships work. Not only am I missing a lot of the value that comes out of a relationship, but I am simplifying everything for argument's sake. Men and women do not court on a monetary fair-value basis, but it's interesting. If you ever observe that really attractive women tend to be higher maintenance, well, there may well be a good economic reason for it.

I hope you enjoyed this economic analysis of dating. Remember, it was a line of thought that was fleshed out from two very drunk traders and one female banker (who gave very little input). It does not reflect in any way how I think of dating in general, but I enjoy thinking through these sorts of things from a "purely rational" perspective.