When the U.S. Supreme Court ruled recently that states must allow same-sex couples to marry, Justice Anthony Kennedy’s opinion focused on dignity and equality. While the value of dignity for same-sex couples is priceless, the economic value of legal equality is easier to imagine and calculate. But it’s not just same-sex couples who will benefit from access to the practical rights and benefits of marriage. The ripple effects of marriage equality will spread outward to businesses and the larger economy in Georgia.
First comes love, then the weddings. Walking down the aisle can be an expensive trip, as anyone who’s done it recently knows. Parents might not be as willing to chip in for their gay or lesbian kid’s wedding, though, and some of these couples might have already had a big celebration of their relationships. At UCLA’s Williams Institute, our estimates of new wedding spending assume that same-sex couples will spend about $5,800, or just a quarter of the typical wedding of almost $23,000 in Georgia in 2012. We also add the spending from out-of-state guests, a tourism benefit to the state.
Next we estimate how many couples will marry. The U.S. Census Bureau reports more than 21,000 same-sex couples live together in Georgia and most of them have waited patiently for the right to marry in front of family and friends in their home state. Judging from other states’ experiences, about half of those couples will marry in the next three years. Putting these pieces together, almost 11,000 couples will likely marry and spend a total of approximately $79 million in Georgia over the next few years.
Who wins?
Same-sex couples and their children get the stability and security that come with marriage, including benefits from employers, lower taxes, and social security benefits. Small businesses like bakers, caterers, restaurants, florists, hotels, wedding planners and other parts of the wedding industry gain from this surge of pent-up demand. They’ll also need to hire new employees to meet that demand.
Companies that employ people in same-sex couples will also gain. Some of the nation’s largest companies told the Supreme Court they wanted nationwide marriage equality so that they could recruit and retain the best employees. They complained that the patchwork of marriage laws across the country added to their administrative costs and made it hard to transfer employees with same-sex spouses to states that wouldn’t recognize those marriages.
Georgia’s state budget will also gain when more people can marry, reducing expenditures and raising revenues. We count on family members to take care of each other through sickness, health, and unemployment. Our public assistance programs build in that expectation. So when same-sex couples can marry, they’re less likely to need, or to qualify for, cash assistance, for example. As a bonus, new wedding spending will pour sales tax revenue into state and local government coffers — more than $5 million by our estimates.
Same-sex couples will no longer have to pay the unfair taxes, legal fees and other charges caused by marriage bans, spending that could add up to nearly $500,000 over a long relationship. Now same-sex couples can use that money for other family expenses, like health insurance premiums, retirement savings, a house downpayment, or kids’ college expenses. Greater access to health insurance and less social stigma will mean better physical and mental health for the people in same-sex couples. These investments in health, education, and homes pay long-term dividends to economies and societies, not just to the individuals who make them.
New jobs and more money in the pockets of small business people in Georgia are clearly only the tip of the iceberg economically. Economists and other scholars are increasingly recognizing the importance of equality and inclusion for strengthening economies. As same-sex couples plan their weddings, Georgians can look forward to a long-term equality dividend.
M.V. Lee Badgett, an economics professor who directs the Center for Public Policy at the University of Massachusetts Amherst, is a distinguished scholar at the Williams Institute of UCLA.
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