Efficiency in Marriage
Economists usually assume that bargaining in marriage leads to efficient outcomes. The most convincing rationale for this assumption is the belief that efficient allocations are likely to emerge from repeated interactions in stationary environments, and that marriage provides such an environment. This paper argues that when a current decision affects future bargaining power, inefficient outcomes are plausible. If the spouses could make binding commitments -- in effect, commitments to refrain from exploiting the future bargaining advantage -- then the inefficiency would disappear. But spouses seldom can make binding commitments regarding allocation within marriage. To investigate the efficiency of bargaining within marriage when choices affect future bargaining power, we consider the location decisions of two-earner couples. These location decisions are transparent and analytically tractable examples of choices likely to affect future bargaining power, but the logic of our analysis applies to many other decisions. For example, decisions about education, fertility, and labor force participation are also potential sources of inefficiency.
|Date of creation:||Dec 2001|
|Date of revision:|
|Publication status:||published as Shelly Lundberg & Robert Pollak, 2003. "Efficiency in Marriage," Review of Economics of the Household, Springer, vol. 1(3), pages 153-167, September.|
|Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Shelly Lundberg & Robert A. Pollak, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-158, Fall.
- Robert Pollak, 2003.
"Gary Becker's Contributions to Family and Household Economics,"
Review of Economics of the Household,
Springer, vol. 1(1), pages 111-141, January.
- Robert A. Pollak, 2002. "Gary Becker's Contributions to Family and Household Economics," NBER Working Papers 9232, National Bureau of Economic Research, Inc.
- Lundberg, S. & Pollak, R.A., 1991.
"Separate Spheres Bargaining and the Marriage Market,"
91-08, University of Washington, Department of Economics.
- Lundberg, Shelly & Pollak, Robert A, 1993. "Separate Spheres Bargaining and the Marriage Market," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 988-1010, December.
- Lundberg, S. & Pollak, R.A., 1991. "Separate Spheres Bargaining and the Marriage Market," Discussion Papers in Economics at the University of Washington 91-08, Department of Economics at the University of Washington.
- Kai A. Konrad & Kjell Erik Lommerud, 2000.
"The bargaining family revisited,"
Canadian Journal of Economics,
Canadian Economics Association, vol. 33(2), pages 471-487, May.
- Konrad, Kai A. & Lommerud, Kjell Erik, 1996. "The Bargaining Family Revisited," CEPR Discussion Papers 1312, C.E.P.R. Discussion Papers.
- Konrad, K.A. & Lommerud, K.E., 2000. "The Bargaining Family Revisited," Norway; Department of Economics, University of Bergen 212, Department of Economics, University of Bergen.
- Mincer, Jacob, 1978. "Family Migration Decisions," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 749-73, October.
- Saku Aura, 2002.
"Uncommitted Couples: Some Efficiency and Policy Implications of Marital Bargaining,"
CESifo Working Paper Series
801, CESifo Group Munich.
- Saku Aura, 2002. "Uncommitted Couples: Some Efficiency and Policy Implications of Marital Bargaining," Working Papers 0217, Department of Economics, University of Missouri.
- Saku Aura, 2003. "Uncommitted Couples: Some Efficiency and Policy Implications of Marital Bargaining," Microeconomics 0304002, EconWPA.
- Ariel Rubinstein, 2010.
"Perfect Equilibrium in a Bargaining Model,"
Levine's Working Paper Archive
661465000000000387, David K. Levine.
- Kaushik Basu, 2006.
"Gender and Say: a Model of Household Behaviour with Endogenously Determined Balance of Power,"
Royal Economic Society, vol. 116(511), pages 558-580, 04.
- Kaushik Basu, 2004. "Gender and Say A Model of Household Behavior with Endogenously-determined Balance of Power," Harvard Institute of Economic Research Working Papers 2054, Harvard - Institute of Economic Research.
- Basu, Kaushik, 2001. "Gender and Say: A Model of Household Behavior with Endogenously-Determined Balance of Power," Working Papers 01-01, Cornell University, Center for Analytic Economics.
- Lundberg, Shelly & Startza, Richard & Stillman, Steven, 2003.
"The retirement-consumption puzzle: a marital bargaining approach,"
Journal of Public Economics,
Elsevier, vol. 87(5-6), pages 1199-1218, May.
- Shelly Lundberg & Richard Startz & Steven Stillman, 2001. "The Retirement-Consumption Puzzle: A Marital Bargaining Approach," Working Papers 01-04, RAND Corporation Publications Department.
- Peters, H Elizabeth, 1986. "Marriage and Divorce: Informational Constraints and Private Contracting," American Economic Review, American Economic Association, vol. 76(3), pages 437-54, June.
- Chiappori, Pierre-Andre, 1988. "Rational Household Labor Supply," Econometrica, Econometric Society, vol. 56(1), pages 63-90, January.
- Junsen Zhang & William Chan, 1999. "Dowry and Wife's Welfare: A Theoretical and Empirical Analysis," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 786-808, August.
- Ligon, Ethan, 2002. "Dynamic bargaining in households (with an application to Bangladesh)," CUDARE Working Paper Series 972, University of California at Berkeley, Department of Agricultural and Resource Economics and Policy.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:8642. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.