INTRAHOUSEHOLD ALLOCATION AND GENDER RELATIONS: NEW EMPIRICAL EVIDENCE FROM FOUR DEVELOPING COUNTRIES

TLDR

Recent theory and empirical work contrasts unitary and collective household models, the latter positing that members have distinct preferences and that intrahousehold allocations mirror individual power and preferences. The study uses new household data from Bangladesh, Indonesia, Ethiopia, and South Africa to measure individual human capital and asset control at marriage as indicators of bargaining power. The authors assess human capital and individually-controlled assets at marriage to quantify bargaining power within households. All four countries reject the unitary model; women’s controlled assets significantly boost spending on children’s education and clothing, and parental preferences differ by child gender across and within countries.

Abstract

The paper reviews recent theory and empirical evidence testing unitary versus collective models of the household. In contrast to the unitary model, the collective model posits that individuals within households have different preferences and do not pool their income. Moreover, the collective model predicts that intrahousehold allocations reflect differences in preferences and power of individuals within the household. Using new household data sets from Bangladesh, Indonesia, Ethiopia, and South Africa, we present measures of individual characteristics that are highly correlated with bargaining power, namely human capital and individually-controlled assets, evaluated at the time of marriage. In all country case studies we reject the unitary model as a description of household behavior, but to different degrees. Results suggest that assets controlled by women have a positive and significant effect on expenditure allocations toward the next generation, such as education and children's clothing. We also examine individual-level education outcomes and find that parents do not have identical preferences toward sons and daughters within or across countries.