Thrifty Wives and Lavish Husbands? – Bargaining Power and Financial Dicisions in Germany
AbstractNumerous contributions in the literature show that household outcomes are influenced by the distribution of intra-household decision power expressed by bargaining indicators such as relative income of the spouses. Since women can expect a longer retirement period, increased female bargaining power could lead to higher savings and wealth accumulation. In contrast, a household could consume more in the current period (e.g., to the benefit of the children) if gender differences in saving preferences had other rationales. Using two German datasets and different measures of bargaining power, my analysis gives evidence that female bargaining power has no or a negative influence on saving and wealth even when controlling for expectations of future support by public pension schemes of the spouses. In some specifications, I also find positive associations between the wife‘s bargaining power and attitudes towards current consumption proxied by repayments of consumer loans. Different results for subsamples of couples with and without dependent children support the validity of the “kids-do-better hypothesis” which indicates that mothers use their bargaining power to enforce higher current consumption in favor of the children.
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Bibliographic InfoPaper provided by Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen in its series Ruhr Economic Papers with number 0258.
Length: 39 pages
Date of creation: Apr 2011
Date of revision:
Find related papers by JEL classification:
- D1 - Microeconomics - - Household Behavior
- D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving
- J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
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- Thomas Bauer & Mathias Sinning, 2011.
"The savings behavior of temporary and permanent migrants in Germany,"
Journal of Population Economics,
Springer, vol. 24(2), pages 421-449, April.
- Bauer, Thomas & Sinning, Mathias, 2005. "The Savings Behaviour of Temporary and Permanent Migrants in Germany," CEPR Discussion Papers 5102, C.E.P.R. Discussion Papers.
- Bauer, Thomas K. & Sinning, Mathias, 2005. "The Savings Behavior of Temporary and Permanent Migrants in Germany," IZA Discussion Papers 1632, Institute for the Study of Labor (IZA).
- Thomas Bauer & Mathias Sinning, 2005. "The Savings Behavior of Temporary and Permanent Migrants in Germany," RWI Discussion Papers 0029, Rheinisch-Westfälisches Institut für Wirtschaftsforschung.
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