Ethnicity in children and mixed marriages: Theory and evidence from China

by

Torsten Persson and Ruixue Jia

Abstract

This paper provides a framework to study how individual and social motives shape identity choice and applies it to the ethnic choice of children in ethnically mixed marriages. The model highlights the interaction of material benefits, identity costs, and social reputations. It is consistent with two motivating facts for ethnic choices in China, and also delivers a set of auxiliary predictions. The empirical tests on Chinese microdata find support for these predictions. In particular, social motives significantly crowd in changes in material motives in some localities, and crowd out the same changes in other localities. These effects are quantitatively important and statistically robust. We also discuss various alternative forces such as bargaining, which do shed light on the pattern of ethnic choices but cannot explain our main finding on the interplay between individual material incentives and social motives.