Gay-onomics and the Marriage Debate

The phones started ringing at the Timberholm Inn in Stowe, Vt., in April, as soon as lawmakers voted to override a gubernatorial veto and allow same-sex marriage in the state. "It doesn't go into effect till Sept. 1, but people are thinking ahead," says the inn's co-owner, Susan Barnes. "We've got two same-sex weddings booked for October." Those bookings are good news for Barnes, who says the gay-friendly inn takes in a "couple of thousand" dollars with every wedding it hosts. And they are part of the reason some same-sex-wedding advocates are now pointing out a new legalization angle: the economic payoff. (Article continued below...)

In the five years since legalizing same-sex marriage, Massachusetts has gained $111 million in spending from gay weddings, according to a new study published by UCLA's Williams Institute, which studies sexual-orientation law and public policy. "That's money buying flowers, hotels, caterers, hiring a band—all the things that go into a wedding," explains M. V. Lee Badgett, a coauthor of the study.

Typically, same-sex couples spent about $7,400 per wedding, says Badgett, an economist who is also director of UMass Amherst's Center for Public Policy & Administration, and one in 10 couples spent more than $20,000. And then there were the wedding guests: "We estimated that each same-sex couple was associated with $1,600 in hotel-occupancy tax revenue," she says.

Promises of a gay-wedding payoff are hardly new: back in 2004, a U.S. Congressional Budget Office analysis predicted that the federal government would benefit by nearly $1 billion in increased tax revenue each year if same-sex marriages were legalized in all 50 states and recognized by the federal government.

Still, some economists urge caution in looking for same-sex wedding profits—in particular citing a kind of "first-mover advantage" that benefits states with early gay-marriage laws. (After similar laws were passed in neighboring states Vermont and Maine, New Hampshire became the latest state to legalize same-sex marriage on Wednesday, but the state might not gain as much as did Massachusetts, which has become a destination for gay couples from other states.)

"If you're the 50th state to allow [same-sex] weddings, you're not going to get as much of a bump as the first state," says Michael Steinberger, an assistant professor of economics at Pomona College who worked with the Williams Institute on the Massachusetts study. "There's going to be a bump, but it cannot be as big."