Three essays on intra-household allocation

Abstract

In a marriage market when individuals of different qualities meet, the partner with the better quality may accept the match if marriage payments exist or if the marriage surplus is divisible and the inferior quality partner can commit to a lower share. It is this second aspect that brings the two literatures of matching in the marriage market and intra-household allocation of resources together. This commitment of household shares at the time of marriage adds a novel dimension to the two literatures. We look specifically at the use of contraception and division of labour in the household. Using data from rural Bangladesh in 1998-1999, the first paper finds that women in a relatively strong bargaining position at the time of marriage (gauged by the fraction of marriage payments composed of brideprice), continue to remain in a strong position post marriage as seen by their decision to use the contraceptive pill. The second paper uses data from eighteen waves of the British Household Panel Survey (1991-2008) to investigate the division of labour in households. We argue that the partner who is relatively of better quality, or more specifically better educated, is given a larger share from the marital output by the lower quality partner to secure the match. Variations in the division of household labour in the data confirm this. In addition the empirical results indicate that the relative bargaining power of individuals at the time of matching persists during the marriage, through a sharing rule that varies over time but is agreed on by them at the time of marriage. We then look at another aspect of intra-household allocation, the decision to send children in the household to work. Using data from the Pakistan Social and Living Standards Measurement Survey (PSLM) 2007- 2008 we find that variations in child labour are a consequence of variations in parental preferences rather than differences in household income.