Pierre André Chiappori (Columbia) "Family Economics" - Cemmap

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2. The gains from marriage 97 Case 1: wb >α,bis the custodian Married Separated <strong>Family</strong> Work at Work at member home Utility home Utility a 1 (w b +α) 2 w 4 0 a w b 2 b 0 0 ( wb 2 )2 k − w b +α 2 − w b 2 Case 2, wb
98 2. The gains from marriage This shifts attention to the question which types of partnerships are likely to last. Gains from human partnerships need not be confined to a couple of the opposite sex. One also observes ”extended families” of varying structures which coordinate the activities of their members and provide self insurance. The prevalence of male-female partnerships has to do with sexual attraction which triggers some initial amount of blind trust. (The Bible is quite right in puzzling over why ”shall a man leave his father and mother and cleave unto his wife” 9 .) Equally important is a strong preference for own (self produced) children. These emotional and biological considerations are sufficient to bring into the family domain some activities that could be purchased in the market. Then, the accumulation of specific ”maritalcapital” in the form of children, shared experience and personal information increases the costs of separation and creates incentives for a lasting relationship. In this sense, there is an accumulative effect where economic considerations and investments reinforce the natural attachment. Other glues, derived from cultural and social norms also support lasting relationships. But in each case customs interact with economic considerations. The weaker is the market, the more useful is the extended family and social norms (commands) are added to the natural glue. Keeping these considerations in mind, we can now address the question which activities will be carried out within the family. One argument is that the family simply fills in gaps in the market system, arising from thin markets, or other market failures, see Locay (1990). Another line of argument (see Pollak (1985)) is that the family has some intrinsic advantages in monitoring (due to proximity) and in enforcement (due to access to non-monetary punishments and rewards). A related but somewhat different argument is that family members have already paid the (sunk) costs required to acquire information about each other, see Ben-Porath (1980). Thus, credit for human capital investments may be supplied internally either because of a lack of lending institutions or because a spouse recognizes the capacity of her partner to learn and is able to monitor the utilization of his human capital better than outsiders. Similarly, annuity insurance is provided internally, either because of lack of annuity markets or because married partners have a more precise information on their spouse’s state of health than the market at large. It is clear that these three considerations interact with each other and cannot be easily separated. The main insight is that the gains from marriage depend on the state of the market and must be determined in a general equilibrium context. 9 Genesis 2: 24.
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Family Economics Martin Browning Pi
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iv 3.2 Householdproduction ........
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vi 6.4 IntertemporalBehavior ......
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viii 11 Marriage, Divorce, Children
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List of Figures 1.1 Marriage Rates
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xiii 4.2 Apotentiallycompensatingva
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Introduction The existence of a nuc
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two distinct solution concepts; one
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were affectedbytherisinginvestments
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Murat Iyigun, Guy Lacroix, Valérie
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Part I Models of Household Behavior
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14 1. Facts there appear to be age,
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16 1. Facts 1.1.4 Transitions The m
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18 1. Facts sumption goods within h
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20 1. Facts may not capture the ful
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22 1. Facts This process is driven
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24 1. Facts 1.4 Children Children a
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26 1. Facts a major policy concern
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28 1. Facts have means for, say, hi
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30 1. Facts [21] Michael, Robert,
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32 1. Facts Age group USA Denmark 1
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34 1. Facts Birth cohort 1931-36 19
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36 1. Facts USA Canada UK Norway Ye
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38 1. Facts Country Male Participat
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40 1. Facts Mother’s Age 20-30 31
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42 1. Facts rate per 1000, 20+ 18 1
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44 1. Facts Marriage rate per 1000
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Page 65 and 66: 52 1. Facts 1 0.8 0.6 0.4 0.2 0 23
Page 67 and 68: 54 1. Facts 0.8 0.6 0.4 0.2 0 23 25
Page 69 and 70: 56 1. Facts 0.8 0.6 0.4 0.2 0 1968
Page 71 and 72: 58 1. Facts 6.8 6.6 6.4 6.2 6 5.8 2
Page 73 and 74: 60 1. Facts 0.4 0.2 0 -0.2 -0.4 196
Page 75 and 76: 62 1. Facts 0.6 0.4 0.2 0 1968 1970
Page 77 and 78: 64 1. Facts FIGURE 1.23. Age Pyrami
Page 79 and 80: 66 1. Facts 0.6 0.4 0.2 0 1930 1933
Page 81 and 82: 68 1. Facts 100% 80% 60% 40% 20% 0%
Page 83 and 84: 70 1. Facts 0.35 0.3 0.25 0.2 0.15
Page 85 and 86: 72 1. Facts 100% 80% 60% 40% 20% 0%
Page 87 and 88: 74 1. Facts Average number of child
Page 89 and 90: 76 1. Facts Age 28 27 26 25 24 23 1
Page 91 and 92: 78 1. Facts FIGURE 1.37. Consumptio
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Page 95 and 96: 82 2. The gains from marriage for o
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Page 113 and 114: 100 2. The gains from marriage [14]
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148 3. Preferences and decision mak
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158 4. The collective model: a form
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200 5. Empirical issues for the col
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244 6. Uncertainty and Dynamics in
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292
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294 7. Matching on the Marriage Mar
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334 8. Sharing the gains from marri
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392 9. Investment in Schooling and
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436 10. An equilibrium model of mar
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460 11. Marriage, Divorce, Children
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Pierre André Chiappori (Columbia) "Family Economics" - Cemmap

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