The market for gay relationships

The market for homosexual relationships is an interesting one from the analysis perspective. Like the market for heterosexual relationships, it is a matching market (we are in a relationship if and only if I like you AND you like me). Unlike heterosexual relationships, it is not a “bipartite” market, since both the nominal “buyer” and the “seller” in a transaction will come out (no pun intended) of the same pool (gay people of a particular sex).

The other factor that makes this market interesting (purely from an analysis perspective – it’s bad for the participants) is that there is disapproval at various levels for homosexual relationships. Until today, for example, it was downright criminal to indulge in gay sex in India. Even where it is legal, there is massive social and religious opposition to such relationships (think of the shootout at the gay bar in Florida, for example).

Social disapproval has meant that gays sometimes try to keep their sexuality under wraps. Historically, it has been a common practice for gays to enter into heterosexual marriages, and pursue relationships outside. In fact, there is nothing historical about this – read this excellent piece by Srinath Perur on gays in contemporary hinterland Karnataka, for whom Mohanaswamy, a collection of short stories with a gay protagonist, was a kind of life changer.

Organising a market for an item that is illegal, or otherwise frowned upon, is difficult, since people don’t want to be found participating in it. If I were a gay man looking for a partner, for example, I couldn’t go around openly looking for one if I didn’t want my family to know that I’m gay. So the first task would have been discovery – “safe spaces” where I would be happy to expose my sexuality, and where I could also meet potential partners.

When demand and supply exist, buyers and sellers will find a way to meet each other, though often at high cost. One such “way” for homosexual people has been the gay bar. Though not explicitly advertised, such bars act as focal points (I have a chapter on focal points in my book) for gay people.

They also act as an “anti focal point” (a topic I HAVEN’T covered in the book, for a change!) for heterosexual people who want to stay away because they don’t want to be hit on by gay people (thus reducing market congestion – another topic I cover in my book). Similarly other cultural activities have acted as focal points for gay people to get together and meet each other.

Like in heterosexual relationship markets (this is the link to a sample chapter from the book), the advent of dating apps has revolutionised gay dating, as apps such as Tinder and Grindr have provided safe spaces where gays can look for relationships “from the comfort of their homes”. There are studies that show that Grindr has changed the nature of relationships among gay men, and how these apps have “saved lives” in places such as India where homosexuality was criminal until today.

Today’s Indian Supreme Court ruling will have a massive positive impact on gay relationships in India. For starters, there are still millions of people in the closet – while apps such as Tinder and Grindr allowed more people to participate in these markets (since this could be done without really “coming out”), that gay sex was a criminal act would have led to some people to err on the side of caution (and deprive themselves of the chance of a relationship). Gay people who were worried about criminality, but not that much about social sanctions, will now be more willing to come out, leading to an increase in the market size.

Barring congestion (when “bad counterparties” prevent you from finding “good counterparties”),  the likelihood of finding a match in a market is generally proportional to the number of possible counterparties. Since gay relationship markets are not bipartite, we can say that the likelihood of finding a good match varies by the square of the number of market participants (and this brings in the Indian Prime Minister’s infamous 2ab term). In other words, it not only allows the people now coming into the market to find relationships, but it also allows existing players to find better relationships.

Then, there is the second order effect. Decriminalisation will mean that more people will come out of the closet, which will mean more people will find homosexuality to  be “normal” leading to better social mores (to take a personal example, I used to use the word “gay” as a pejorative (to mean “uncool”) until I encountered my first openly gay acquaintance – someone with whom I share on online mailing list). And as social attitudes towards homosexuality change, it will lead to more people coming out of the closet, setting off a virtuous cycle of acceptance of homosexuality.

In other words, today’s decision by the Indian Supreme Court is likely to set off a massive virtuous cycle in the liquidity of the market for homosexual relationships in India!

PS: It is a year since my first book was published, so we are running a promotional offer where you can buy the Kindle version for one dollar (or Rs. 70).


Tinder and Arranged Scissors

For those of you who have been following my blog for a while know, I was in the arranged marriage market for a brief period in 2009, before Priyanka magically materialised (from the comments section of this blog) and bailed me out. I may not have covered this in any of the Arranged Scissors posts that I wrote back then (ok I alluded to this but not really), but I had what I can now call a “Tinder moment” during the course of my time in the market.

So on this fine day in Bangalore, I was taken to this Marriage Exchange called Aseema. The name of the exchange is quite apt, since based on two data points (my own and one acquaintance’s), if you go there your search for a spouse is literally endless.

My uncle, who took me there and who was acting as my broker-dealer for that brief period, told me that they literally had binders full of women (note that this was three years before Romney), and that I could search leisurely if I accompanied him there on Saturday morning.

My uncle didn’t lie. This place did have several binders full of women (and men – I too ended up in one such binder after I signed up) and four binders that said “Smartha (my subcaste) Girls” were pulled out and handed over to me. My uncle probably expected me to spend a few hours ruminating through the binders and coming up with a shortlist.

It was nothing like it. Each profile in the binder followed a standard format. There was this 4 by 6 full-length photo. You knew where to look for educational qualifications. And professional summary. It was like LinkedIn meets Facebook profile picture. And that was it.

I remember having some criteria, which I don’t remember now. But once I had gone through the first few pages, it became mechanical. I knew exactly where to look in a particular profile page. And quickly come to a judgment if I should express interest.

Thinking back, I might have just been swiping (mostly left – I came up with a grand shortlist of one after the exercise) on Tinder. The amount of time I spent on each profile wasn’t much more than what the average user spends on Tinder. Except that rather than looking only at the photo, I was also looking at a few profile parameters (though of course whether I would want to sleep with her was one of the axes on which I evaluated the profiles). But it was just the same – leafing through a large number of profiles in a short amount of time and either swiping left or right instantly. Talking to a few other friends (some of it at the now legendary Benjarong conference) about this, my experience seemed representative (note that I’m still in anecdata territory).

Maybe there is a lesson in this for all those people who are designing apps for arranged marriage (including the venerable and That even though the stated intent is a long-term relationship, the initial process through which people shortlist is no different from what people follow on Tinder. Maybe there surely is a market for a Tinder-like arranged marriage application!