Racial-Ethnic and Gender Differences in Returns to Cohabitation and Marriage: Evidence from the Current Population Survey

Using data on cohabitation from the 1995-1997 March Current Population Survey, the first three years in which the survey included "unmarried partner" as a relationship category, I measure the relationship between earnings and cohabitation as well as other marital statuses across racial-ethnic groups for men and women. Results show that among 25-54 year-old workers, black women have the largest cohabitation "premium" -the earnings advantage over never-married workers -more than three-times the premium for white women. Hispanic women have no cohabitation premium. White men have the largest marriage premium, and each other group except white women also has a significant marriage premium. There is a significant cohabitation benefit for white men, black men, and Hispanic men. Substantial differences in observed effects across groups suggest the need for models that are more complicated than previously used. Research into marital status effects on earnings is misleading when restricted to white men.