spousal bargaining over care for elderly parents in china imbalances in sex ratios influence the allocation of support abstractusing a unique chinese survey of parents and adult children this paper examines how married children negotiate with their spouses for time devoted to caring for their own parents applying a collective bargaining framework i show that the sex ratio at marriage shifts household bargaining in favour of the husband s parents when women are less scarce or against his parents when women are scarcer such changing dynamics in the family may potentially reverse the current preference for sons in china implying that those with sons rather than daughters may be increasingly in need of state support

rational household labor supply traditionally household behavior is derived from the maximization of a unique utility function in this paper we propose an alternative approach in which the household is modeled as a two member collectivity taking pareto efficient decisions the consequences of this assumption are analyzed in a three good model in which only total consumption and each member s labor supply are observable if the agents are assumed egoistic i e they are only concerned with their own leisure and consumption it is possible to derive falsifiable conditions upon household labor supplies from both a parametric and nonparametric viewpoint if alternatively agents are altruistic restrictions obtain in the nonparametric context useful interpretation stems from the comparison with the characterization of aggregate demand for a private good economy

marriage market divorce legislation and household labor supply this paper provides a theoretical framework for analyzing the impact of the marriage market and divorce legislation on household labor supply in our approach the sex ratio in the marriage market and the rules governing divorce are examples of distribution factors these factors are defined as variables that affect the household members bargaining position but not preferences or the joint budget set we extend the collective labor supply model developed by chiappori to allow for distribution factors we show that our model imposes new restrictions on the labor supply functions and eases the identification of individual preferences and the intrahousehold decision process the model is estimated using psid data for the year 1988 our results do not reject the restrictions imposed by the model also the sex ratio and divorce laws deemed favorable to women are found to affect labor supply behavior and the decision process in the directions predicted by the theory and to have sizable effects

remittance effects on child labour evidence from burkina faso abstractthis article explores the effects of remittance receipt on child labour in an african context we focus on burkina faso a country with a high prevalence of child labour and a high rate of migration given the complex relationship between remittance receipt and household time allocation decisions we instrument remittances using economic conditions in remittance sending countries and explore heterogeneous effects across different types of potential remitters while remittances have no significant effect on child labour on average transfers reduce child labour in long term migrant households for whom the disruptive effect of migration is no longer felt we find no gender difference but remittances seem to affect mainly the labour market participation of younger children

building the family nest premarital investments marriage markets and spousal allocations we develop a model of the household in which spousal incomes are determined by premarital investments the marriage market is characterized by assortative matching and endogenously determined sharing rules form the basis of intra household allocations by incorporating pre marital investments and spousal matching into the collective household model we are able to identify the fundamental determinants of endogenously determined and maritally sustainable intra marital sharing rules in particular we find that all sharing rules along the assortative order support unconditionally efficient outcomes where both pre marital investments and intra household allocations are efficient the efficiency of both pre marital choices and household allocations then enables us to show that for each couple the marriage market generates a unique and maritally sustainable sharing rule that is a function of the distribution of pre marital endowments and the sex ratios in the market

the effect of annuity insurance on savings and inequality this paper examines the amount of precautionary savings and wealth inequality arising from life span uncertainty by comparing saving behavior under perfect insurance arrangements with that arising under imperfect arrangements namely when longevity risk can be pooled only with members of one s own family the central findings of the paper are that 1 perfecting insurance arrangements can sharply lower savings in both intergenerationally altruistic and life cycle economies and that 2 in altruistic economies perfecting annuity insurance can greatly influence inequality indeed in the long run in our model switching from imperfect family insurance to perfect insurance can mean the difference between absolute inequality and absolute equality

how do sex ratios affect marriage and labor markets evidence from america s second generation sex ratios i e relative numbers of men and women can affect marriage prospects labor force participation and other social and economic variables but the observed association between sex ratios and social and economic conditions may be confounded by omitted variables and reverse causality this paper uses variation in immigrant flows as a natural experiment to study the effect of sex ratios on the children and grandchildren of immigrants the flow of immigrants affected the second generation marriage market because second generation marriages were mostly endogamous i e to members of the same ethnic group the empirical results suggest that high sex ratios had a large positive effect on the likelihood of female marriage and a large negative effect on female labor force participation perhaps surprisingly the marriage rates of second generation men appear to be a slightly increasing function of immigrant sex ratios higher sex ratios also appear to have raised male earnings and the incomes of parents with young children the empirical results are broadly consistent with theories where higher sex ratios increase female bargaining power in the marriage market

international migration and gender discrimination among children left behind this paper considers how international migration of the head of household affects the allocation of resources toward boys relative to girls within households remaining in the home country i address the endogeneity of migration with a differences in differences style regression model that compares those households in which migrants have already returned home with those in which migrants are still away the evidence suggests that while the head of household is away a greater fraction of resources are spent on girls relative to boys but upon his return this pattern is reversed

capital accumulation and the characteristics of private intergenerational transfers many recent studies of the process of family accumulation in general and household response to social security in particular have revealed growing dissatisfaction with the life cycle theory of saving see for example barro 1978 kotlikoff 1979 darby 1979 kotlikoff and summers 1981 kurz 1981 blinder gordon and wise 1981 david and menchik 1982 leimer and lesnoy 1982 an alternative to the life cycle hypothesis is expressed by defining the preference of each family over its own consumption as well as the welfare of the generations that follow thus each family consists of an infinite chain of generations who have interdependent preferences and for this reason we shall call it the inter generational hypothesis it was recently used by barro 1974 1978 to attack the conclusions of the life cycle hypothesis our purpose in this paper is to start the long road of studying the structure of the private inter generational transfer system with the aim of providing additional tests of the two competing hypotheses

the strategic bequest motive although recent research suggests that intergenerational transfers play an important role in aggregate capital accumulation our understanding of bequest motives remains incomplete we develop a simple model of strategic bequests in which a testator influences the decisions of his beneficiaries by holding wealth in bequeathable forms and by conditioning the division of bequests on the beneficiaries actions the model generates falsifiable empirical predictions that are inconsistent with other theories of intergenerational transfers we present econometric and other evidence that strongly suggests that bequests are often used as compensation for services rendered by beneficiaries

limited liability and the modern corporation in theory and in practice the catastrophic consequences of a lack of public control over the operations of large private corporations have been thrown into sharp relief by two major events in the recent past the global financial crisis and the deepwater horizon oil spill in the gulf of mexico while these events obviously differ in scope and nature they nevertheless turn the spotlight on a fundamental problem of contemporary capitalism an economic system that facilitates the privatisation of gains in the hands of ever smaller elites while also socialising risk losses in an anarchic manner to the detriment of the many is not politically viable in the long run this is the case in particular if a core element of this system s legitimacy is its claim to promote democracy at home and around the world based on principles of transparency and accountability both the global financial crisis and the deepwater horizon oil spill have already attained the status of watershed events mainly because the social economic and environmental risks inflicted by private actors on very large groups of people were extraordinary and the causes of failure to manage these risks were systemic rather than accidental at the heart of the systemic nature of these watershed failures lies the gradual evolution of the modern corporation into organisations with the power to re shape in their favour a changing and varied history of precarious balancing acts between public and private interests in advanced capitalist economies from its beginnings capitalism has been defined by the primacy of economic over political organisation most famously encapsulated in adam smith s metaphor of the invisible hand much later albert hirschman s insightful account of how the interests gradually came to outweigh the passions hirschman 1977 provides a detailed analysis of such early legitimisation patterns according to which the pursuit of individual freedom and economic selforganisation would be the driving force of political pacification and collective civilisation yet from the beginning such high expectations were curbed by warnings of potential conflicts between private and public interests if the former became too powerful thus adam smith himself pointed out that t o widen the market and to narrow the competition is always the interest of the dealers to widen the market may frequently be agreeable to the interest of the public but to narrow the competition must always be against it and can serve only to enable the dealers by raising their profits above what they naturally would be to levy for their own benefit an absurd tax on the rest

do husbands and wives pool their resources evidence from the united kingdom child benefit common preference models of family behavior imply income pooling a restriction on family demand functions such that only the sum of husband s income and wife s income affects the allocation of goods and time testing the pooling hypothesis is difficult because most family income sources are not exogenous to the allocations being analyzed in this paper we present an alternative test based on a natural experiment a policy change in the united kingdom that transferred a substantial child allowance to wives in the late 1970s using family expenditure survey data we find strong evidence that a shift toward greater expenditures on women s clothing and children s clothing relative to men s clothing coincided with this income redistribution

limited liability and multinational enterprises a case for reform in the context of corporate groups the legal principles of limited liability and corporate separation can lead to injustice in cases of harmto involuntary creditors by externalising risks that ought to be internalised by the enterprise as the better risk taker the avoidance of responsibility can be achieved by interposing a separate legal entity between the victims and the ultimate controller of the group be it a parent company or its controlling shareholders the resulting lack of legal responsibility could be remedied in a number of ways ranging from adaptations of existing exceptions to the doctrine of limited liability to outright abolition of limited liability preference is given to a statutory principle of enterprise liability for the controlling entity the implications of these doctrines are also discussed in relation to the choice of jurisdiction in which to bring a legal action

the determinants of bargaining power in an empirical model of transfers between adult children parents and in laws for south korea abstract we derive a bargaining model of transfers between adult children and their parents and then estimate the model using data from south korea our analysis extends the literature on family bargaining by i arguing that transfers from the couple represent semiprivate consumption e g it is plausible that the wife cares more about her parents than about the husband s parents and vice versa and ii using results from laboratory experiments to help identify the model we find that women have slightly more bargaining power than men in the couple s decision making we also find that when an adult child receives an extra dollar of income she transfers half of it to her parents this result is consistent with previous work finally we reject the null hypothesis that bargaining power within the family depends only on the potential wage of each spouse

the effect of social security on lifetime wealth accumulation and bequests this paper is an empirical study of the effects of social security on lifetime wealth accumulation and bequests using a sample of wisconsin males we have matched lifetime earnings records from income tax returns with their social security account records and their bequests obtained from probate court records since the cohort of males was born between 1890 and 1899 they represent a cohort that saw a great change in the size and coverage by occupation of the system hence there is substantial within cohort variation in social security wealth from which effects can be estimated for nearly 30 years the life cycle theory of savings has enjoyed an enormous amount of academic support in the no bequest variant individuals save with the sole intention of consuming their savings in later years the economy wide stock of capital can therefore be generated by this pattern without any reliance on bequests modigliani 1966 such a model will lead to rather strong predictions about the effect of a pay as you go public pension hereafter social security on private savings as feldstein 1974 points out social security should displace private savings as well as reduce macro saving since the programme is unfunded this result follows from the assumption that each household will consume all of its assets during its own lifetime some recent research however has been at odds with the no bequest variant of the life cycle model see kurz 1984 and included references darby 1979 claims that life cycle assets savings consumed later in the life cycle constitute only 13 29 per cent of total assets kotlikoff and summers 1981 report that the major share nearly 80 per cent of capital stock in the united states is due to intergenerational transfers 2 indeed these authors write life cycle models of savings that emphasize savings for retirement as the dominant form of capital accumulation should give way to models that illuminate the determinants of intergenerational transfers p 706 in addition recent empirical work suggests that people tend to accumulate or fail to significantly decumulate wealth wealth in old age a finding at odds with the strict life cycle model 3 given the potentially large role of bequests in the process of capital accumulation it is important to know how bequests are affected by the large public programme that social security has become even if social security depresses private savings among those near or at retirement if people bequeath it is conceivable that saving during retirement is augmented by the programme 4 aside from the issue of savings effects the response of people s bequests to their old age benefits might allow one to assess the target efficiency of the social security system since the original objective of the system was to ensure adequate levels of consumption among the elderly a finding that benefits

household intertemporal behaviour a collective characterization and a test of commitment in this paper a formal test of intra household commitment is derived and performed to that end two models of household intertemporal behaviour are developed in both models household members are characterized by individual preferences in the first formulation household decisions are always on the ex ante pareto frontier in the second model the assumption of intra household commitment required by ex ante efficiency is relaxed it is shown that the full efficiency household euler equations are nested in the no commitment euler equations using this result the hypothesis that household members can commit to future allocations of resources is tested using the consumer expenditure survey i strongly reject this hypothesis it is also shown that the standard unitary framework is a special case of the full efficiency model however if household members are not able to commit household intertemporal behaviour cannot be characterized using the standard life cycle model these findings have two main implications first policy makers can change household behaviour by modifying the decision power of individual household members second to evaluate programmes designed to improve the welfare of household members it would be beneficial to replace the standard unitary model with a characterization of household behaviour that allows for lack of commitment

dowry and intrahousehold bargaining evidence from china this paper analyzes the relationship between a woman s intrahousehold bargaining position and her welfare within marriage using household data from rural china simultaneity problems are overcome by using dowry to proxy for bargaining position omitted variable bias is addressed by using grain shocks in the year preceding marriage as an instrument for dowry instrumented dowry positively impacts numerous measures of a wife s welfare including household purchases the time allocation of household members and the woman s satisfaction with life offering strong evidence in support of collective models of the household

limited liability shareholder rights and the problem of corporate irresponsibility there has long been a tendency to see the corporate legal form as presently constituted as economically determined as the more or less inevitable product of the demands of advanced technology and economic efficiency through an examination of its historical emergence focusing in particular on the introduction of general limited liability and the development of the modern doctrine of separate corporate personality this paper takes issue with this view arguing that the corporate legal form was and is in large part a political construct developed to accommodate and protect the rentier investor it is moreover a construct which institutionalises irresponsibility against this backdrop different ways of trying to resolve the problem of corporate irresponsibility are explored the key the paper suggests is to be found in decoupling the privilege of limited liability from rights of control

private monetary transfers in rural china are families altruistic monetary transfers between relatives may be motivated by altruism or they may represent payments for services rendered data from a large 1988 household survey are used to test these hypotheses and to study the size and direction of transfers in rural china the analysis suggests that altruism alone cannot explain the observed transfers and that exchange may be involved most of the money flows appear to be transfers from adult children to elderly parents and remittances from migrants child care is likely to be one of the main services that parents render to adult children in exchange for money

collective labor supply and welfare the paper develops a general collective model of household labor supply in which agents are characterized by their own possibly altruistic preferences and household decisions are only assumed to be pareto efficient an alternative interpretation is that there are two stages in the internal decision process agents first share nonlabor income according to some given sharing rule then each one optimally chooses his or her own labor supply and consumption this setting is shown to generate testable restrictions on labor supplies moreover the observation of labor supply behavior is sufficient for recovering individual preferences and the sharing rule up to a constant finally the traditional tools of welfare analysis can be adapted to the new setting

south south migration and discrimination against women in social institutions a two way relationship summary using the social institutions and gender index sigi from the oecd development centre this paper provides evidence on the two way relationship between discrimination against women in social institutions and south south migration on the one hand discriminatory social institutions in both origin and destination countries are an additional determinant of female migration on the other hand migration implies changes in discrimination against women according to the level of gender inequalities at destination specifically migration toward countries with low levels of discrimination promotes gender equality in social institutions at home while migration toward destinations with high levels of discrimination has the reverse effect

parental wealth and adult children s welfare in marriage abstract many studies find that parental resources importantly determine children s human capital schooling returns and earnings the collective household approach suggests that in addition parental resources of marital partners may importantly affect resource distributions within marriage this paper presents empirical results consistent with this framework they suggest that parental wealth continues to play roles in augmenting welfare of children into adulthood beyond provision of human capital in early life cycle stages or direct financial aid during adulthood and that actual transfers from parents to adult children do not fully measure influences of parental wealth on behaviors and welfare of adult children

household bargaining over fertility theory and evidence from malaysia we develop and test a model of household bargaining over fertility when transfers between spouses are possible the model makes precise how the fertility preferences of each spouse translate into fertility outcomes we show this depends on whether or not spouses can commit to their future actions within marriage if couples bargain with commitment fertility outcomes take account of both spouses fertility preferences and do not depend on the threat point in marital bargaining if couples bargain without commitment the influence of each spouse s fertility preference on fertility outcomes depends on the relevant threat point in marital bargaining and the distribution of bargaining power we test the models using household data from the malaysia family life survey this data set contains information on each spouse s desired fertility level as well as fertility outcomes we exploit differences in threat points in marital bargaining across ethnic groups to help identify the underlying bargaining model the evidence suggests couples bargain without commitment

the root cause of economic growth under capitalism drawing on historical and other empirical evidence this paper provides a causal explanation of a central question why sustained per capita growth occurs in capitalist economies i e in what way capitalism differs from the market that gives it this property it describes an endogenous economic logic that is based on the institutional characteristics of capitalist firms in the non financial sector especially the flexibility of the inputs that they can call upon and of the size of the market that they can supply this perspective naturally generates a realistic theoretical account not only of the source of economic growth but also of the evolution of market structure the forces that produce divergence in for example profit rates a starting point for explaining price setting and a language for describing firms economic power it draws on previous traditions especially those based on the works of marx and schumpeter but differs from them in important respects copyright the author 2011 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

motives for private income transfers private income transfers are becoming increasingly recognized as a key aspect of the u s economy the majority of private income transfers occur inter vivos i e between living persons but very little is known about this type of transfer behavior this paper tests alternative hypotheses concerning motivation for inter vivos transfers two motives are considered altruism and exchange evidence presented here casts doubt on the altruistic model of transfer behavior observed patterns for inter vivos transfers are more consistent with exchange related motives this finding has important implications for the effects of public transfer programs on the distribution of economic well being

the family inheritance and the intergenerational transmission of inequality unequal inheritance of material wealth is commonly considered a major cause of inequality in consumption however theoretical models of the intergenerational transmission of inequality by becker blinder and ishikawa imply that unequal inheritance may either increase or reduce consumption inequality differences in inherited wealth resulting from unequal parental incomes increase inequality in recipients consumption however unequal bequests caused by differences among families in the endowed ability of children or the costs of producing human capital are equalizing empirical results confirm these predictions the inheritance received by children is inversely related to both children s income and parental education thus bequests are compensatory in that ceteris paribus low income children inherit more than their advantaged contemporaries

dowry and wife s welfare a theotrical and empirical analysis becker attributes the existence of marital transfers to inflexibility in the division of joint product within the marriage if that were the only reason we would not have observed the coexistence of dowries and bride prices this paper offers an alternative analysis while becker s interpretation is retained for bride prices a dowry is now represented as a premortem bequest by altruistic parents for a daughter it not only increases the wealth of the new conjugal household but also enhances the bargaining power of the bride in the allocation of the output within the household thereby safeguarding here welfare using micro data from taiwan we found that a dowry improves the bride s welfare whereas a bride price has no effect these empirical results support the theoretical predictions of the model

the joint determination of household membership and market work the case of young men except in special cases market work and household membership are jointly chosen a nash bargaining model of family behavior is used to specify stochastic structural relationships two indirect utility functions and a market and a reservation wage function that jointly determine work consumption and household membership the maximum likelihood estimates of the implied trinomial probit model differ sharply from those obtained when either market work or household membership is taken as exogenous this application to white male youths from the national longitudinal surveys shows the insurance function of families parents insure their sons against poor market opportunities

collective labour supply with children we extend the collective model of household behavior to allow for the existence of public consumption we show how this model allows the analysis of welfare consequences of policies aimed at changing the distribution of power within the household our setting provides a conceptual framework for addressing issues linked to the targeting of specific benefits or taxes we also show that the observation of the labor supplies and the household demand for the public good allow one to identify individual welfare and the decision process this requires either a separability assumption or the presence of a distribution factor

marriage the sharing rule and pocket money the case of south korea abstract using longitudinal data on private consumption from south korea this article examines the marital balance of power between spouses in a dynamic setting by allowing for unobserved heterogeneity at the household level and spouses time constant unobserved bargaining power i find that unobserved power plays a significant role in intrahousehold resource allocation the income pooling hypothesis is no longer rejected after accounting for unobserved power relative spousal earnings may be a good proxy for the long term balance of power to an extent that cross sectional variation in relative earnings across households reflects the pattern of spousal matching however within marriage changes in relative earnings do not induce any significant resource transfer between spouses the balance of bargaining power is stable within marriage

geography of the family we study the residential choice of siblings who are altruistic towards their parents the firstborn child s location choice influences the behavior of the second born child and can shift some of the burden of providing care for the parents from one child to the other these strategic considerations lead to an equilibrium location pattern with firstborn children locating further away from their parents than second born children we also analyze the location choices empirically using german data these data confirm our theoretical predictions jel h41 j10