Tuesday, September 5, 2017

Equilibrium in the Tinder Market?

When demand shifts up we expect price to rise, ..., or quality to fall. Worst-online-dater over at Medium.com has done some analysis of activity on Tinder. The nice thing about heterosexual matching markets is that there is are almost equal numbers of males as females. With a few exceptions, matches tend to be one-to-one. But, before settling down (and perhaps after), there appears to be much more interest by men in dating women than women in dating men. Normally this would lead to side payments but that has traditionally been frowned upon. So what other mechanism allocates scarce women to the surplus of men?

Quality, or at least attractiveness, sorts these scarce women to all these men. The curve between the pink and the blue represents equal numbers of Tinder "likes" by attractiveness percentile of men and women.

Men must be quite attractive to be "liked" on Tinder while women need not be.
In reality, the bottom 80% of men are fighting over the bottom 22% of women and the top 78% of women are fighting over the top 20% of men.

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  2. "Tinder is a vast marketplace of individuals making choices. That’s the economy in a nutshell" (Diedrich 2014). Consider the opportunity cost in online dating vs. meeting someone in "real life." Tinder is free and hosts an infinite amount of presumably single people. The alternative to meeting people is going to a bar or a coffee shopping or being set up by a friend. Chances are higher of matching with someone on Tinder.

    It's interesting that women need an attractive man, however men do not necessarily prefer an attractive female. Men are willing to for go looks to have more matches. When swiping right or left singles should consider all costs and benefits and their consequences.

    "Another factor boosting the online dating trend is cost: It's simply a much cheaper way of getting a date. Strategists at ConvergEx Group, a New York-based global brokerage company, crunched numbers from statisticbrain.com and found that online dating can save a person thousands of dollars.

    "The dating phase prior to an offline marriage runs up a $23,660 tab. The average dating site customer spends just $239 a year for online memberships, which more than pays for itself to the tune of $12,803 in cost savings from fewer dates," the report said" (Hamm 2014).


    Diedrich, J (2014) Everything I Know About Economics I learned From Tinder. Fee.org

    Hamm, N. (2014) How To Make Money Off the Online Dating Boom. CNBC

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