This week marks ten years since the first legal same-sex marriages took place in the U.S. At 12:01 am on May 17, 2004, the state of Massachusetts started issuing marriage licenses to gay couples. Since then, more than a dozen states have followed suit, and still more are in the middle of legal battles over whether they should.
Setting aside for a moment the debates around justice, personal freedom, and religion, there are also plenty of economic dimensions to the legalization of same sex marriage. While the research is limited, there are a number of studies that show that legalizing same sex marriage is a net good for the economy. A few years ago, researchers at the William’s Institute at UCLA conducted surveys and combed through state- tax records, and found that during the first years of same-sex weddings in Massachusetts, the local economy got a boost of more than $111 million. Studies of other states have shown similar benefits.
The benefits extend from a family budget to a state budget, says Lee Badgett, an economist at the University of Massachusetts, Amherst, who is behind much of the research.
At the personal level, for couples who live in a state that recognizes gay marriage, legalization has “probably saved them a lot of money,” she says. “It gives people security to be treated legally as a family and to have access to health care benefits, social security benefits,” she says.
Across the country about 150,000 same sex couples have gotten married in the last ten years according to Badgett. Meaning, a bump in business for the companies that make those weddings happen. A survey from TheKnot.com found that the average same-sex couple spends about $10,000 on their wedding.
“That’s millions and millions of dollars that are being pumped in to local economies and small businesses, like florists, caterers and hotels,” Badgett says, pointing out that all this business has come at an important time– during an otherwise gloomy economy.
“Our business keeps tripling every year,” says Michael Jamrock, the founder of EnGAYgedweddings.com, a national clearinghouse where LGBT-friendly wedding services pay to advertise their businesses to same-sex couples about to tie the knot. When Jamrock started the company six years ago, Massachusetts and Connecticut were the only states where same-sex marriage was legal. “Whenever a new state becomes legal, the traffic to the website is just absolutely phenomenal,” he says.
Legalization can also boost state revenue, says economist Badgett. States see more sales tax dollars—from couples spending on their weddings, and guests who travel from out of state to celebrate. There can also be a rise in income tax revenue from couples filing jointly.
Badgett says legalizing gay marriage can also mean less government spending on social safety net programs, as married couples pool financial resources often rely on less public assistance.
“When marriage strengthens families in terms of economic security, that’s also good for state budgets,” she says.
Legalizing gay marriage can also bring some extra costs. Spouses of state and private employees may qualify for more retirement and health-care benefits. But economists who’ve crunched the numbers say on net, those costs don’t outweigh the overall revenues.
A report in 2004 from the Congressional Budget Office, then headed up by Doug Holtz-Eakin (who now runs the conservative American Action Forum) estimated that if same-sex marriage was recognized in all fifty states and at the federal level, the federal budget’s bottom line “would improve the budget’s bottom line to a small extent: by less than $1 billion in each of the next 10 years.”
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