Economics of love

Bilal Hussain

To me love is caring about someone so deeply that life looks incomplete when they are away, however, the connotations for love are many and varied. While, economics is about allocation of scarce goods and services. Nothing more scarce than love, it is rare, hard to come by and often fragile as well.

The ambit of both fields apparently seems separate but I have observed that they do intersect and overlap each other on many fronts hence: economics of love. Based on the experiences heard from near and dear ones, I could safely say that the return in love is proportional to the amount of time and devotion invested in it. The amount of love one gets from an investment in it is correlated to the amount of self one has invested in the relationship.

It is believed that love addresses spiritual needs of humans, in the rare state where two become one, something that most of us desire for. Moving from spirituality to pricing, to associate a price with the love, looks insane but few have attempted it, let me put it how.

Pricing of love is challenging than the normal pricing of stocks or commodities because there is no public marketplace for 'true love'. However, the alternative to market-driven pricing is the familiar territory of cost plus pricing.

Consider costs of love: one, the cost of search, finding 'true love'. The cost of search is amount of time and energy spent in networking and information gathering, among many other practices. Two, the cost of dating, again time-cost, and the recurring cost of restaurants. It also includes the cost of possible distractions from career. Three, cost of rejection, which includes the high emotional cost of being dumped. Being optimistic, hope it won’t happen then moving further to other costs. Four, maintenance cost once the love affair has taken a more serious tone. Five, cost of long-term partnership, opportunity cost of giving up one’s freedom in pursuing another potentially 'exciting partner', as well as the opportunity cost of career and life adjustments. And lastly, cost of love is the cost of a potential incompatibility and break-up, including the inevitable mess that accompanies such separation.

Interestingly look at the similarities, the investments that are based on care and unselfishness, the investor gets those things back. The quality bonds consistently yield more return than trash, so is with quality love. As for the returns it is said that junk bonds are free money but because of the high default risk, the bonds rarely outperform quality investments. As far love is concerned stay with high quality human beings. Once you find that you are in a junk relationship, 'sell immediately'. Junk situations can look appealing and seductive, but trash is trash.

Like investments in stocks, long-term romantic relations returns are greater. Don't pick stocks for short terms vision as most a times it is risky and can put you at loss, same hold true for love.

Before you invest make sure that the returns on your investment should at least equal the cost of the investment. If you are getting less back than you put in over a considerable period of time, back off.

Ben Franklin has summed it “In times of stress, the three best things to have are an old dog, an old wife and ready money. How right he was?”

There is more that could be said about the economics of love, but these thoughts could possibly divert someone while he/she might be thinking about his/her future love. To end I would say invest smart and stay happy!