RELIGIOUS INTERMARRIAGE: AN ECONOMIC PERSPECTIVE Carmel U. Chiswick and Evelyn L. Lehrer University of Illinois at Chicago ABSTRACT This paper develops an economic framework for analyzing the relationship between religion and marriage. The economic and demographic implications of religious intermarriage are far- reaching: it is known to be associated with substantially higher rates of marital instability and with lower levels of fertility (Becker et al, 1977; Lehrer, 1992), thereby also influencing female labor supply and investments in child quality. Religious intermarriage may be viewed as either a problem or an opportunity by denominations concerned with the size of their membership in the current and future generations. In addition, intermarriage tends to enhance the melting-pot aspect of the American culture, blurring distinctions along ethnic and religious lines, with important implications for social policy. Yet there is no systematic theoretical model for an economic perspective on the determinants of intermarriage. Part I of this paper develops an economic model of intermarriage, covering both the gains associated with religious homogamy and the associated process of marital search. Using this analytical framework, Part II discusses the effects of observed variables on the incidence of interreligious marriage. Part III closes the paper with a brief summary and suggestions for future research. I-AN ECONOMIC MODEL OF INTERMARRIAGE Intermarriage occurs when spouses differ in their religious affiliations. 1 It is a dichotomous variable: a union is either inter-faith or intra-faith for a given definition of religious groups. 2 To analyze the behavior which leads to intermarriage, however, it is useful to view as an underlying continuous variable the degree of religious compatibility: a measure of the similarity between two people in their religious beliefs and practices. Although the correspondence need not be perfect, the spouses in Contemporary Jewry Vol. 12, Annual