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Love or money the economics of online dating


When it comes to love, money has nothing to do with it. Right?Not so fast. After all, they don't call it a "meet market" for nothing. The dating world is, in fact, its own market, with complex economic judgments taking place all the time. That is according to Dr. Marina Adshade, an economics professor at the University of British Columbia and author of the book "Dollars & Sex," which examines the relationship between money and love."Dating markets don't have currency, so they depend on other mechanisms to operate, much like a barter system," Adshade said. "It all depends on what you are bringing to the table. Some of those qualities might be age or attractiveness - and some are financial."Indeed, just go on popular dating sites such as Match.com, and one of the criteria for winnowing down potential matches is annual income. You can look for someone who makes $50,000 a year, or $75,000, or $100,000. So, does that matter? Well, in one study published in the Journal of Economic Behavior & Organization, which crunched data from a popular Chinese online-dating website, male profiles with the highest income levels got 10 times more visits than the lowest. Another study, co-authored by famed behavioral economist Dan Ariely, uncovered similar online-dating preferences.

"Men and women prefer a high-income partners over low-income partners," the authors wrote in the journal Quantitative Marketing and Economics. "This income preference is more pronounced for women."The takeaway: As much as we like to think we are beyond the days of Jane Austen, when suitors were evaluated largely based on how much money they brought in - the famous Mr. Darcy in "Pride & Prejudice" was worth "Five thousand a year!" - money can be critical in our romantic lives."Someone's income will almost always factor into the equation," says Douglas Kobak, a financial planner in Conshohocken, Pennsylvania. "When you are becoming serious, you need to consider what your partner is bringing to the table besides love and a good time. The question becomes one about the potential to earn the income needed to build wealth and live a lifestyle you want."

ECONOMIC JUDGMENTS Just think about the numerous economic judgments we are making while dating online. First off, we are essentially estimating our own value (which may or may not be accurate), Adshade notes. At the same time we are estimating others' value, and whether they are likely to respond - or whether they are "out of our league."Then we are weighing interested suitors against the "opportunity costs" that there may be other, 'better' options still out there. And we make these judgments against the backdrop that we are all, sadly, depreciating assets. Wait too long for an ideal person, and you could miss out on quality matches, who will eventually be snapped up themselves. There are also competing economic theories at work. Are you looking for someone relatively similar in qualities like income and education ("market theory")? Or are you looking for someone sufficiently different from yourself, that you both gain from the union ("economic trade theory")?

One note to remember: Annual income is just one financial data point, and probably not even the most important one. In terms of long-term economic security, it is better to partner with someone who makes $50,000 annually but lives below their means, than someone who makes $100,000 a year but spends wildly and racks up debt. "Money itself is not nearly as important as are money habits," says Robert Braglia, a financial planner in New York. Adshade's key advice for would-be romantics: Broaden the criteria you are looking for in a mate. If you are solely looking for a man who is over 6'2" and makes six figures annually, you have instantly gone from a "thick" market - one with literally millions of people - to a "thin" one, with few remaining options. Indeed, the tall, rich guy with a full head of hair is probably off the market already, she says. Instead, devote yourself to a more "exhaustive" search that includes a wider variety of income levels, she advises. It will take more time to sift through that broader pool, but that is better than "artificially reducing the size of your search sample," she says. "That is the biggest mistake."The writer is a Reuters contributor. The opinions expressed are his own.

Mideast money turkey steps up islamic finance push as sensitivities ease


May 29 When Turkish Prime Minister Tayyip Erdogan came to power a decade ago it would have been almost unthinkable for his government to issue an Islamic bond, given accusations it was seeking to erode Turkey's secular status. Now, as it seeks to boost political and commercial ties with the Gulf and diversify its borrowing, one of the Muslim world's most dynamic economies is developing an Islamic finance industry which could rival current volumes in Malaysia - the world's top sukuk issuer - within 10 years. Turkey has a strong secular identity. Its Islamic banks are known locally as participation banks, in part reflecting public sensitivities. But nervousness about Islamic finance has eased in recent years, helped by growth of the sector in Western economies. Just over a year after its debut dollar-denominated sukuk issue, Turkey's Capital Markets Board is finalising regulations on five new types of Islamic bond as the country aims to become a major issuer of Islamic debt. The new rules, which were sent to Erdogan's office for approval this week, will allow Turkish corporates and banks, as well as the Treasury, to issue the world's most widely used types of sukuk, giving them access to a wider pool of investors via a global market estimated at more than $100 billion."Islamic finance is just like halal food, there may be two reasons to choose it," said Mustafa Cetin, head of financial institutions at the Turkish arm of Bahrain-based Islamic lender Al Baraka."Either you prefer interest-free products or you find the cost of borrowing, the taste, attractive."Unlike the oil-fuelled economies of the Gulf, whose Islamic debt issuance is primarily sovereign, Turkey has a powerful private sector which is increasingly eager to finance international projects using sharia-compliant products. As part of plans to celebrate the 100th anniversary of the founding of the modern republic in 2023, Turkey aims to turn its economic and cultural capital Istanbul into a major financial centre. It foresees $350 billion of infrastructure spending on the project, with Islamic finance expected to be one of the major sources. Construction company Agaoglu, which will build the Istanbul Finance Center, has said it plans to borrow $2 billion through sharia-compliant instruments, topping the total value of Turkey's existing sovereign dollar sukuk issuance.

INDUSTRY SET TO TRIPLE Turkey's Islamic lenders have enjoyed rapid growth in recent years but remain a small part of the banking system. The share of participation banks has risen to 6 percent of total banking assets from 2 percent a decade ago, when Erdogan's Justice and Development (AK) Party first came to power. As part of efforts to develop the sector, the government wants to see that share increase to 15 percent over the next decade and is determined to support this through regulation, as well as by encouraging unbanked rural residents to open accounts with Islamic lenders."Turkey's 2023 financial services vision could see the Islamic banking industry tripling in size to more than $100 billion, approximately where Malaysia is today," accounting firm Ernst & Young said in its latest World Islamic Bank report. Turkey's two largest state-run banks, Ziraat and Halkbank , look set to help achieve that target, with both about to establish their own participation banks.

Turkey's Islamic banking sector may be small given the country's population of 76 million is 99 percent Muslim, but its conventional capital markets are much more developed than many other Muslim nations."In Malaysia, whose population is 75 percent Muslim, the Islamic banking share ... is 35 percent while in Turkey it is only a 6 percent share," Albaraka Turk's Cetin said."Albaraka Turk is growing 20 percent yearly in assets and branches. That means we are doubling in size every 4-5 years."The bank will be one of eight primary dealers for a debut sukuk issue, set for June, by the Malaysia-based International Islamic Liquidity Management Corp (IILM), formed to boost global liquidity in Islamic instruments. Turkey's support for the IILM is seen as further evidence of its commitment to the sector. Turkey's new regulations, which will allow the use of more instruments including Istisna, Murabaha, Mudaraba, Musharaka and Wakala bonds, and stronger local Islamic banks should help the country attract more funding from the Gulf, where appetite for Islamic products far outstrips supply.

The country's recent upgrade to investment grade status by major rating agencies Fitch and Moody's will also make international borrowing easier for Turkey. POLITICAL SENSITIVITIES Kuveyt Turk, a subsidiary of Kuwait Finance House, was the first Turkish company to issue a sukuk when it borrowed $100 million in 2010. It then tapped the market in 2011 for a $350 million sharia-compliant issue. The Turkish government entered the market in September 2012 with a $1.5 billion Ijarah sukuk - an asset-backed leasing structure in line with Islamic principles - followed by two more domestic issues totalling more than 3 billion liras ($1.6 billion). The Treasury aims to issue lira-denominated Ijarah sukuk at least twice a year, one each February and the other each August or September, to build a healthy lira-denominated sukuk curve. Each issue is expected to be around 1.5 billion lira. Turkey was technically ready to take part in Islamic finance a decade ago but chose not to for political reasons. In March 2008, a state prosecutor asked Turkey's top court to shut down the ruling AK Party for anti-secular activities, even though it had won two successive elections with large majorities. He also sought to ban Erdogan from politics."The main reason we are behind the curve is political. There was no room in the late 2000s for sharia-compliant government borrowing while the AK Party was being charged with being anti-secular," said one senior banker who declined to be named because of the sensitivity of the topic. The AK Party, born of a coalition of Islamists, centre-right politicians and nationalists, has always denied any secret Islamist agenda and has vigorously promoted market reforms. The banker said government efforts to boost Islamic finance were important, although he questioned whether Turkey had already left it too late to catch up with the rest of the world.