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Inequality within Families

Paper Session

Friday, Jan. 7, 2022 10:00 AM - 12:00 PM (EST)

Hosted By: American Economic Association
  • Chair: Shelly Lundberg, University of California-Santa Barbara

Marriage Market and Labor Market Sorting

Ana Reynoso
,
University of Michigan
Paula Calvo
,
Yale University
Ilse Lindenlaub
,
Yale University

Abstract

We build a novel equilibrium model in which households’ labor supply choices form the link between sorting on the marriage market and sorting on the labor market. We first show that in theory, the nature of home production—whether partners’ hours are complements or substitutes—shapes marriage market sorting, labor market sorting and labor supply choices in equilibrium. We then estimate our model on German data to assess the nature of home production in the data, and find that spouses’ home hours are complements. We investigate to what extent complementarity in home hours drives sorting and inequality. We find that the home production complementarity—by strengthening positive marriage sorting and reducing the gender gap in hours and labor sorting—puts significant downward pressure on the gender wage gap and within-household income inequality, but it fuels between-household inequality. Our estimated model sheds new light on the sources of inequality in today’s Germany and—by identifying important shifts in home production technology towards more complementarity—on the evolution of inequality over time.

Dowries, Resource Allocation, and Poverty

Rossella Calvi
,
Rice University
Ajinkya Keskar
,
Rice University

Abstract

We study the relationship between dowries -- wealth transfers from the bride's family to the groom or his family at the time of marriage -- and individual-level poverty in rural India. Based on the estimates of a collective household model, we show that the share of household consumption expenditure allocated to a woman is strongly associated with the dowry she paid at the time of her marriage. We compute poverty rates separately for women and men and find that women's poverty relative to men decreases with dowry. Moreover, women who paid dowries are less likely to be poor relative to women who did not, even when their households' consumption expenditures are the same. Our counterfactual policy analysis indicates that abolishing or reducing dowries (through anti-dowry laws or taxes, for example) may have the unintended effect of aggravating intra-household inequality and increasing women's risk of living in poverty after marriage.

The Effect of Violent Crime on Intra-household Resource Allocation and Bargaining Power

Maria Hernandez-de-Benito
,
University of Alicante

Abstract

The effects of exposure to community violence are numerous and complex, and we should not expect them to be gender-neutral. This paper studies the effects of violent crime on household expenditures and intra-household bargaining power. I exploit an unexpected and geographically heterogenous increase in local violence in Mexico using a nationally representative longitudinal survey of married households formed prior to the increase in crime. I first estimate a household demand model and find that the escalation in violence reallocated household expenditures towards male goods, at the expense of food and other household necessities. These findings would typically be interpreted as a deterioration in women's bargaining power. But changes in local violence may have also affected consumption preferences. To show that the results can be explained by changes in bargaining power, I compute the effect of violence on intra-household resource shares within a structural setup that allows for violence to also affect preference parameters. The increase in violence also led the household members themselves to report decreases in female decision-making power. Finally, I discuss the evidence on the role played by changes in women’s outside options.

Brothers, Sisters, and Support to Older Parents: Separate Spheres Across and Within Support Types?

Christine Ho
,
Singapore Management University
Kathleen McGarry
,
University of California-Los Angeles

Abstract

Sons have historically been more likely to provide support to older parents than daughters in China. Nevertheless, with modernization and more opportunities for women, it is unclear whether this still holds. In this study, we draw on data from the China Health and Retirement Study to examine the patterns of assistance from adult children to their older parents. We focus on differences by gender and on the impact of the gender composition of siblings in the assistance provided by each child. We find that sons are vastly more likely to provide coresidence than daughters but daughters are more likely to provide financial support (cash or in kind). Conversely, conditional on the provision of financial support, sons provide greater amounts. Interestingly, we find significant evidence of the crowd-out of support by siblings, but only within gender: each daughter gives less when she has more sisters whereas each son gives less when he has more brothers. This suggests that the family may view support from sons and daughters differently.
Discussant(s)
Frederic Vermeulen
,
University of Leuven
Arthur Lewbel
,
Boston College
JEL Classifications
  • J1 - Demographic Economics