An Economist’s Wholehearted Defense Of Online Dating Sites

-OpEd-

Users of Meetic, Tinder and other dating apps now number in the hundreds of millions. Many are frightened by it, worried about rampant abuse and scams, while others see it as another example of the evils and excesses of modern society. And yet, these dating sites have a great social utility.

Online dating provides a new way to build a short-lived or lasting relationship. It has been added to the traditional opportunities to find a partner in one’s network, namely our professional environments, family circles, group of friends, bars, concerts, etc. In fact, these in-person meetings are even losing their importance. In the United States, one in three recent marriages began with an online encounter, and this proportion increases every year.

Should we think of this shift as a substitution without great consequences for society, something akin to buying books on the internet rather than in bookstores? No, but not for the reasons you may imagine. Compared to marriages that originated with a traditional first-encounter, those that began with an online connection last longer, end in fewer divorces and more often bring together couples of different religions or ethnicities.

The knowledge of preferences — one’s own and those of others — is indispensable for a successful match.

Online platforms make it possible to break out of an often homogenous environment and considerably expand the number of potential partners. As a result, the chances of meeting a partner closer to your preferences are multiplied. This is obvious for people whose inclinations are less shared — and therefore less common in their close circle. In the United States, 70% of homosexuals meet their partners online. There are also specialized sites that connect people who are allergic to gluten or who love dogs.

Finding a soulmate is not only made easier by the very large number of potential contacts. The knowledge of preferences — one’s own and those of others — is indispensable for a successful match. When they are perfectly known, economic theory shows that the formation of couples is optimal.

Yes, economists have also taken an interest in marriage, even the greatest of them, such as Nobel laureates Gary Becker and Lloyd Shapley. With X number of men and X number of women, what is the best formulation? Ask these economists. For Becker, it’s a matter of complementarity: The perfect match is one that maximizes the gain from living together with children, a house and a car. For Shapley, it’s a matter of rivalry, but everyone ends up finding the right fit, since no couple is worse off than their individual members. Put another way, both of them would probably have preferred an even more desirable partner, but that partner would not have accepted them.

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It’s a match! — Photo: Yogas Design

The development of online dating sites has brought such balances closer. By filling out long registration questionnaires, users better understand their preferences. Based on their responses, they swipe potential matches and through the trial-and-error of first dates, they better measure their desirability. In short, the matches are better, hence the longer duration of relationships compared to marriages initiated at the office, at university, at family gatherings or during Saturday night outings.

In reality, though, the competition isn’t all that fierce.

Of course, we are still a long way from perfect couple formation. Apart from the fact that preferences and desirability change over time, two main reasons can be suggested: imperfect information and imperfect competition between online services.

Imperfect information paves the way for opportunistic behavior. Each person aims higher than their own profile would allow because they can bet on the fact that the other will not notice. But it does not encourage the performance of matching algorithms to be pushed too far, because once the ideal partner has been found and matched, engaged and married, the dating site will lose its subscriber, at least for a while.

Competition between platforms, which focuses on the quality of the matching algorithms, prevents this. In reality, though, the competition isn’t all that fierce, because a great number of the dating sites, including Tinder, the top platform in terms of user numbers, are operated by a single entity.

The market leader isn’t a visible giant like Google or Amazon, but a little-known player called Interactive Corp, which runs Tinder and dozens of other sites — including Plenty Of Fish, Match.com, OKCupid, Hinge and Meetic — through a Nasdaq-listed subsidiary called Match Group. And that’s something to keep an eye on, because a monopoly should not be allowed to undermine the social benefits online dating sites provide.